CITIC SECURITIES has released a report analyzing the military conflict phase initiated in Iran on February 28 local time. As of 10:00 Beijing Time on March 1, the situation remains highly fluid. The firm suggests it is difficult to predict a single definitive outcome at this stage; instead, market movements are more likely to fluctuate in response to key signals. The potential global market impact could either resemble an amplified version of the "Twelve-Day War" of June 2025 or escalate towards more extreme scenarios, depending on potential changes in three critical signals: US military deployments, Iran's internal political stability, and the geographical spillover of the conflict. To provide context for potential market effects, CITIC SECURITIES reviewed the market impacts of eight major conflicts in the Middle East since 1970, summarizing the following patterns: gold tends to outperform the US dollar as a safe-haven asset; oil prices are ultimately dictated by supply and demand in the long term; US stock market performance is directly correlated with the extent of US military involvement and the progression of the conflict; and Chinese assets generally show no significant impact. The main viewpoints of CITIC SECURITIES are as follows:

Event Summary: On February 28 local time, Israel and the United States announced attacks on Iran. This development marks a transition of the Iran situation into a phase of open military conflict, following several rounds of nuclear talks that yielded no substantive breakthroughs. Since 2026, the US and Iran have held three rounds of indirect negotiations via intermediaries such as Oman, focusing on the nuclear issue, arms arrangements, and sanctions relief, but without significant progress. According to Xinhua News Agency reports, Israeli Defense Minister Katz announced a "preemptive" strike on Iran on February 28. Subsequently, former US President Trump announced that the US was conducting "large-scale, sustained military operations" in Iran. Iranian retaliation is ongoing.

Scenario Projection: As of 10:00 Beijing Time on March 1, the situation continues to evolve rapidly. The firm believes it is challenging to project a single final scenario immediately. In the short term, attention should focus on three key signals and their potential changes: US military deployments, Iran's internal political stability, and the conflict's spillover range. The severity of the current situation is already considered to exceed that of the "Twelve-Day War" in June 2025. Global markets may struggle to price in a definitive outcome and are more likely to experience sustained volatility based on important signals. The following three signals require close monitoring.

Signal One: Whether the US further increases its military deployment scale beyond current levels, which will determine the conflict's duration. According to a February 27, 2026, assessment by the Center for Strategic and International Studies (CSIS), current US force deployments around Iran are comparable to the scale during the US "Operation Desert Fox" against Iraq in 1998. This level of deployment supports a limited duration of airstrikes and is particularly insufficient for a large-scale US ground operation against Iran. During "Operation Desert Fox," the US conducted four rounds of airstrikes over approximately 70 hours, with no ground combat involved.

Signal Two: The stability of Iran's internal political situation, which will determine the extent of conflict escalation. According to a Xinhua News Agency report on February 28 local time, former President Trump claimed on Truth Social that Iran's Supreme Leader Khamenei "is dead." Subsequent developments must be closely watched to see if this leads to changes in the conflict or diplomatic landscape.

Signal Three: Whether Iran's retaliation substantially involves key oil production facilities and shipping routes, which will determine the depth of market impact. According to a Xinhua report on February 28, oil tanker traffic through the Strait of Hormuz has stalled. Several major global oil companies and energy traders have urgently instructed a suspension of all oil and fuel vessel transits through the strait to avoid security risks from escalating conflict. It is crucial to monitor whether these threats materialize.

Overall, if the aforementioned signals do not undergo major changes, the market impact could be viewed as an amplified version of the June 2025 "Twelve-Day War" period. However, potential changes in these signals leading to more extreme scenarios must be closely monitored.

Historical Reference: To provide a reference for potential market impact, the firm reviewed the market effects of eight major Middle East conflicts since 1970 (the Fourth Middle East War, Iran-Iraq War, Fifth Middle East War, Gulf War, Afghanistan War, Iraq War, Syrian Civil War, and Israeli-Palestinian conflict), focusing on initial asset price movements. Historical patterns indicate that regarding safe-haven assets, gold prices are more significantly catalyzed by Middle East conflicts compared to the US dollar. The firm judges that the阶段性催化 effect of geopolitical factors on gold is concentrated within approximately the first 10 days following the outbreak of conflict, and whether expectations existed prior to the conflict has a key influence on the price reaction. In energy markets, while historically three oil crises were triggered by Middle East wars, the long-term impact of such conflicts on global oil prices has gradually weakened due to changes in global supply dynamics. The firm's prior research found that historical patterns suggest if a war causes oil prices to rise more than 50% above pre-war levels, it could potentially trigger a US economic recession. For US stocks, historically, if the US is not directly involved in the war, initial sentiment-driven disruptions at the outbreak tend to be repaired within about one week. If the US participates in the war, sentiment recovery in US stocks typically awaits clarity in the conflict's progression. For Chinese assets, due to the lack of a clear transmission mechanism from Middle East conflicts, sentiment-driven disruptions on the day of outbreak have generally been largely repaired by the following day.