Middle East Situation Heats Up: Gold and oil prices may rise together, and resources may become the "sharpest spear" of the year.

Guolian Minsheng Securities released a research report stating that the sudden escalation of the situation in the Middle East directly impacts global risk preferences, and in the short term, the market may exhibit a typical risk-aversion pattern of "rise in gold and oil prices, pressure on risky assets." How the situation in the Middle East unfolds in the future may become a key observation window in the next week. Returning to the resources sector, which the market is paying more attention to, the outlook maintains the view that although the resources sector has catalysts throughout the year, a bull market does not rely on catalysts and is likely to become the sharpest "spear" among major asset classes this year. Short-term geopolitical tensions easing and liquidity changes (potential phased replenishment of the TGA account in April and potential slowing down of the RMP plan will be important observation points) may be points of variation. The main points of view of Guolian Minsheng Securities are as follows: With the United States and Israel launching airstrikes against Iran, the already complex and conflicting situation in the Middle East has officially escalated. In fact, this military strike did not come as a surprise to the market, as the deep-rooted differences between the two sides on core issues such as nuclear programs and sanctions relief have never been able to reach substantive consensus or bridge the gap in positions. Numerous targets within Iran have been attacked, including the presidential palace, intelligence agencies, and the national security department, with Israel even threatening to overthrow the Iranian regime. At the same time, Iran has launched a first-round missile counterattack, vowing to carry out a "devastating" retaliation and entering a state of full alert, making the situation extremely tense. Although the United States and Iran have already completed three rounds of indirect negotiations in Oman, Switzerland, and other locations, the core differences have never been resolved: the United States has a hardline attitude, not only explicitly rejecting Iran's retention of uranium enrichment activities and demanding a commitment to "not developing nuclear weapons," but also attempting to pressure Iran by linking the nuclear issue with missile development and support for regional proxy forces. Iran, on the other hand, adheres to its sovereignty bottom line and proposes a compromise solution of a "limited nuclear program + international supervision," but emphasizes that it must be based on the lifting of US sanctions in key areas such as energy exports and the financial system to ensure the functioning of the domestic economy. With the two sides in diametric opposition, negotiations have reached a deadlock. This attack occurred just after the third round of indirect negotiations between the United States and Iran had just concluded, and both sides were planning to hold technical discussions in Vienna on March 2. The sudden move by the United States and Israel not only cast a shadow over the already fragile negotiations but also highlighted the US strategy of "talking while confronting." For asset management, the sudden escalation of the situation in the Middle East directly impacts global risk preferences, and in the short term, the market may exhibit a typical risk-aversion pattern of "rise in gold and oil prices, pressure on risky assets." Looking back at the market performance in previous conflicts in the Middle East, this pattern has been validated multiple times: gold, as a traditional safe-haven asset, will attract large-scale capital inflows, driving prices steadily upwards. As for oil, the Middle East is a major global oil-producing region, and the turmoil directly threatens global oil supply security, combined with concerns about the risk of blocking the Strait of Hormuz, oil prices may experience a short-term surge. In comparison, stocks, emerging market currencies, and other risky assets may experience temporary corrections due to heightened risk aversion. How the situation in the Middle East unfolds in the future may become a key observation window in the next week. Combined with the current US-Iran situation, there are three possible scenarios: 1. Baseline scenario (high probability): Controlled retaliation and resumption of negotiations. Iran launches a proportionate retaliation using existing equipment and proxy networks, but deliberately controls the scale of the conflict - not blocking the Strait of Hormuz, not attacking key US military bases, to avoid the situation getting out of control. In this scenario, both sides may resume negotiations through third-party channels, and oil prices may gradually decline from a short-term peak to a range driven by fundamentals. 2. Full escalation scenario (potential risk): Regional skirmishes and an energy crisis. If Iran carries out its threat of "devastating retaliation," the US and Iran will engage in a full-scale conflict, even potentially blocking the Strait of Hormuz, leading to a chain reaction: oil and gold prices may continue to rise, the risk of a breakdown in the global energy supply chain will rapidly increase, financial market volatility will rise, and the global economic recovery process may suffer a major setback. 3. Rapid cooling scenario (low probability): Major power mediation and situation easing. Strong intervention by international organizations and major powers, through diplomatic pressure and interest coordination, pushes the US and Iran to a ceasefire, leading to a rapid cooling of the situation. Risk preferences in the market will be restored, asset prices will gradually return to normal, and oil and gold prices may see narrower increases, with stock markets and other risky assets experiencing a rebound window. Risk warning: Significant changes in US trade policies; tariffs spreading beyond expectations, leading to a more significant than expected global economic slowdown and increased market correction; frequent geopolitical factors leading to increased global asset volatility.