Water is essential to all lifeforms including various ecological, geological, hydrological, and climatic processes/activities. With the changing climate, associated El Niño/Southern Oscillation (ENSO) events appear to stimulate highly uncertain patterns of precipitation (P) and evapotranspiration (E) processes across the globe. Changes in P and EV patterns are highly sensitive to temperature (T) variation and thus also affect natural streamflow processes. This paper presents a novel suite of stochastic modelling approaches for associating streamflow sequences with climatic trends. The present work is built upon a stochastic modelling framework (HMM_GP) that integrates a hidden Markov model (HMM) with a generalised Pareto (GP) distribution for simulating synthetic flow sequences. The GP distribution within the HMM_GP model aims to improve the model’s efficiency in effectively simulating extreme events. This paper further investigated the potential of generalised extreme value distribution (GEV) coupled with an HMM model within a regression-based scheme for associating the impacts of precipitation and evapotranspiration processes on streamflow. The statistical characteristic of the pioneering modelling schematic was thoroughly assessed for its suitability to generate and predict synthetic river flow sequences for a set of future climatic projections, specifically during ENSO events. The new modelling schematic can be adapted for a range of applications in hydrology, agriculture, and climate change.