Possible scenario
Military Escalation Breaks
20% Chance
A lower-probability but high-impact path is direct military escalation involving Iran, the United States, and Gulf partners. Even a partial interruption of Hormuz traffic would produce a sharp one- to two-day repricing across crude, volatility, credit, and transport-linked equities.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- Oil prices Up
- US dollar Up
Secondary impacts
- Consumer Services -4.9%
Portfolio impact
S&P 500-3.4%
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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