Individual investors follow the stock market at a bourse in Nanjing, East China's Jiangsu Province on Monday. Photo: IC

A sudden escalation of tensions in the Middle East over the US killing of a senior Iranian commander is likely to weigh on Chinese stock markets on Monday. 

Global crude prices and gold prices surged as the tension unfolded, with US President Donald Trump saying the US is targeting 52 sites in Iran and Iran warning of consequences.

The situation in the Middle East, a region that accounts for a major source of China's crude imports, could add pressure to the market already weighed down by a new wave of potential sales of previously locked-up shares. A report by the Beijing News put the value of such shares at 682 billion yuan ($97.9 billion), citing WIND data.

The market has largely digested the positive impact of a move by the People's Bank of China, the central bank. The bank announced on January 1 a cut in reserve requirement ratios for banks, which will take effect on Monday. 

The week finished with a 2.6 percent gain for the Shanghai Composite Index but Chinese shares ended mixed on Friday. However, a five-week winning streak is likely to drive some investors to pocket gains on Monday.