17 June 2025 | S&P 500

RBC Capital Markets warns S&P 500 could drop 20% on rising energy prices

RBC Capital Markets warns S&P 500 could drop 20% on rising energy prices

Strategists at RBC Capital Markets LLC. issued a report on the negative impact of Middle East conflicts on oil prices and US stock valuations. Experts warn that the S&P 500 index could fall by 20% in the event of escalating geopolitical tensions and rising inflation in the United States.

Analysts at the firm, led by Lori Calvasina, note that the Middle East crisis could affect the US economy and the Federal Reserve’s policy strategy. In a relatively favorable scenario, the S&P 500 index would likely decline by about 13%. RBC Capital Markets LLC’s worst-case scenario suggests US stocks could drop to April lows, from current levels down 20%.

So far, the situation has not triggered a strong market reaction, Bloomberg reports. Investors note that the conflict remains confined to two countries and has not yet disrupted major energy facilities. On Monday, oil prices declined after a 7% rise on Friday.

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