#Gate广场四月发帖挑战 Possible Developments of the US-Iran War and Insights for the Equity Market

To date, the equity market remains highly sensitive to the Iran conflict. Therefore, assessing the current trajectory of the war has become a key factor in timing decisions. Keywords: US-Iran war, benefiting sectors

1. Most Likely War Development
The US-Iran war has been ongoing for over a month, stirring global capital markets. Japanese and Korean stock markets frequently hit daily limit-ups or circuit breakers, which are highly abnormal phenomena. Remember, abnormal events rarely occur without reason; each one contains opportunities. The so-called "crisis" is a double-edged sword. Based on the current mobilization of both sides, what is the most probable next step?
We believe Trump will initiate limited ground operations to destroy Iran’s missile positions on the coast guarding the Strait of Hormuz. Trump will send warships into the Persian Gulf to escort, forcibly open the Strait, causing oil prices to fall from high levels. A few steps of scenario analysis:
1. Trump assembles 82nd Airborne Division, LPD amphibious ships, and other naval and air landing forces to land on the southwest coast of Iran;
2. Precisely locate and destroy Iran’s coastal missile sites;
3. Iran loses most of its anti-ship capabilities;
4. US warships enter the Persian Gulf to escort, confidently signaling to the world that the Strait of Hormuz is open;
5. Oil prices decline, and Trump declares a decisive victory;
6. US forces "return victorious," while Iran maintains limited control over the strait; (Trump is unlikely to stay long in the Persian Gulf, or Iran will repair its positions, turning US warships into targets, and the strait will ultimately fall under Iran’s control);
7. Oil prices remain in a medium-high range with prolonged oscillation, and limited navigation through the Strait of Hormuz continues for a long time; (once the US withdraws, Iran won’t keep the strait locked for long, or it would become a global enemy).

2. Final Negotiation
If our scenario is correct, then the US will have bargaining chips with Iran. Ultimately, it’s about Iran giving up nuclear weapons and the US relinquishing regime change efforts (which it can’t really achieve). Both sides will declare victory and cease hostilities. Don’t be fooled by the current 15 points from the US and Iran’s 5 points; those are not genuine negotiation terms but intimidation tactics. Every war ends with negotiations, but often a major conflict must occur first, and the intensity may escalate quickly. Buckle up.

3. Sectors to Watch
The Russia-Ukraine war has prompted a renewed appreciation for gold and a disillusionment with the US dollar.
This US-Iran conflict has made the world realize that American military power is no longer what it used to be, and its control over the Middle East has significantly declined.
As a result, the petrodollar pricing system may face cracks.
The war has caused Middle Eastern elites to diversify their investments into safer assets, reducing their dependence on the US. Hong Kong and Singapore could become more attractive options.
The conflict has also led the world to reassess energy security, renewables, wind, solar, energy storage, and electric vehicles.
Finally, the war has prompted a reevaluation of coal and coal chemical industries.