Warning from Morgan Stanley about potential worst-case scenario in Middle East causing stock market impact

From Yahoo Finance: 2025-06-24 18:49:00

Morgan Stanley warns that tensions between Israel and Iran could lead to a worst-case scenario for stocks, with oil prices spiking and risking a recession. Despite a cease-fire, the conflict has raised concerns about oil price volatility. Analysts suggest a significant rise in oil prices could signal the end of the business cycle. Other forecasters, like JPMorgan, see oil prices potentially reaching $130 per barrel if the conflict escalates. This could contribute to stagflation, slowing the economy while inflation remains high. Despite the risks, the S&P 500 historically rose 9% in the 12 months following major conflicts.



Read more at Yahoo Finance: Middle East tensions could unleash a 2-part worst-case scenario that hits stocks, Morgan Stanley says