Possible scenario
Regional Escalation
20% Chance
The Houthis respond to pressure on Sanaa by widening the conflict against Saudi Arabia, Red Sea shipping, or both. This is less likely than a grinding ground battle but carries the largest near-term market impact because of oil infrastructure and maritime-route risks.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- Oil prices Up
- 10-year Treasury yield Down
- US dollar Up
Secondary impacts
- Energy +2.2%
- Industrials
Portfolio impact
S&P 500-1.0%
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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