Context:

Global markets showed resilience in mid-2025 despite rising geopolitical tensions, shaping HSBC’s cautiously bullish stance as strategists questioned whether the rally had more room to run. In June, HSBC’s Max Kettner and peers indicated they weren’t fully convinced by the strength of the market, even as other indicators suggested upside momentum. Across Iran-related tensions, markets largely shrugged off US strikes on Iranian sites and tracked a fragile ceasefire between Israel and Iran that appeared to reduce near-term risk. The combination of ongoing geopolitical risk and resilience in equities underpins HSBC’s outlook, which remains contingent on how tensions unfold and how markets price risk.

Dive Deeper:

• Max Kettner, HSBC's chief multi-asset strategist, privately questioned whether he was bullish enough on the existing market rally in June 2025, signaling a more cautious stance despite a positive backdrop. This view was echoed by other strategists who saw potential upside yet remained wary of overextended momentum.

• June 23–25, 2025: Markets maintained resilience even as tensions in the Iran region escalated, with investors considering the risks and potential upside in risk assets. Analysts noted a divergence between geopolitics and price action, suggesting traders were pricing in limited near-term disruption.

• US strikes on Iranian nuclear sites in June 2025 were a focal point, but global markets largely brushed off the escalation, with many strategists arguing the conflict would be contained and could even support certain risk assets under a risk-on backdrop.

• A fragile ceasefire between Israel and Iran, announced by President Trump in June 2025, appeared to be holding, contributing to positive moves in U.S. equities and a decline in oil prices as the risk of major supply disruptions eased.

• The confluence of market resilience and a tentative pause in geopolitical flare-ups influenced HSBC’s outlook, suggesting that the bank’s optimism rests on stability in risk appetite even as tensions persist and volatility potential remains.

• Overall, the narrative centers on a cautious yet constructive view: if geopolitical risks stay contained and market momentum persists, HSBC’s bullish positioning could be supported; if tensions flare or momentum deteriorates, the outlook may shift swiftly.

• Forward-looking implications include continued scrutiny of global macro cues, potential tactical adjustments by hedges and asset allocators, and close monitoring of policy responses that could either bolster or curb risk assets in the coming weeks.