Willem Sels, Global CIO of HSBC Private Banking and Wealth Management, said in a report that whether oil supply and production are disrupted will affect oil prices, exchange rates, stock market trends, global inflation expectations, and investor risk appetite.

Following the US and Israel's military actions against Iran, there remains considerable uncertainty surrounding potential regime change, the development of military conflicts, and their impact on regional and global economies.

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The extent of the impact will largely depend on how long the conflict lasts, whether oil shipments through the Strait of Hormuz are blocked, and whether Iran's oil production is interrupted.

Any disruption in the Strait of Hormuz would quickly affect inflation expectations, commodity prices, and broader financial markets, the report stressed. If the conflict drags on, oil and gold prices are likely to rise, while the US dollar, Japanese yen, and Swiss franc would strengthen, flattening the yield curve and weighing on equities.

Over the medium term, cyclical stocks and European markets are estimated to underperform those in the US and Asia.

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