Possible scenario
Protracted Exchange Escalates
30% Chance
The air campaign does not break Houthi momentum, and both sides settle into a higher-tempo exchange of airstrikes, drones, and missiles. Oil infrastructure is threatened but not disabled, leaving markets to price a persistent regional-risk premium.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Energy +2.7%
Portfolio impact
S&P 500-1.1%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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