Analysis: The Iran war has triggered a surge in the probability of a US stock market crash, prompting hedge funds to aggressively increase their short positions.

CoinFeed reported on March 9th that, according to Jinshi, senior strategist Ed Yardeni raised his estimate of a market crash for the remainder of the year from 20% to 35%, citing the impact of the escalating conflict in Iran on global markets. These adjustments reflect growing market concerns that the ongoing Middle East conflict, coupled with inflationary shocks, will squeeze household spending, erode corporate profit margins, and complicate the Federal Reserve's policy path. Meanwhile, Goldman Sachs data shows that hedge funds are increasing their bearish bets on US stocks at a rate not seen in nearly five years. In the week ending March 6th, hedge funds increased their short positions in stock exchange-traded funds (ETFs) by 8.3%. Goldman Sachs points out that with little sign of abating tensions in the Middle East, fast-money investors are increasing their bearish bets on US stocks, anticipating further market pain.