HSBC cuts global equities to neutral over Middle East tensions and AI rules

HSBC has cut its global-equity stance from its most bullish rating to neutral, saying Middle East tensions and uncertainty over potential U.S. AI regulation have weakened its confidence in stocks. The bank upgraded developed-market government bonds from a deeply underweight position to overweight, viewing them as a possible beneficiary of political outcomes that could slow AI development or ease fiscal concerns. HSBC also lowered its gold rating and raised crude oil to overweight, while expressing particular caution about eurozone stocks and emerging markets. The shift signals a more balanced allocation rather than a call for markets to fall.