There are 4-5 knots on this as you can see in the photo. How do they affect the integrity of the wood?
It's hard to do more than guess at this without seeing the wood in the flesh and handling it, so no warranty with this but there's a reasonable chance you have nothing to worry about.
Will this reduce the strength of the hiking stick that will be subjected to a lot of stress.
Knots in a board are definite weak spots so I think it's safe to assume that in a branch or thin trunk like this they must also be. But, a weak spot doesn't mean it fatally undermines a board, there are of course a great many things made from knotty wood and they hold up just fine.
And in fact many hiking sticks and walking sticks are traditionally made from knotty wood. In addition, in certain parts of Britain bows were historically made from knotty native yew, with the knots remaining in the bow stave after shaping. Bows of course have to stand up to repeated heavy bending and a sudden release of tension, if they can do this with knots in place it does indicate that at least in some cases knots don't undermine the strength of the piece of wood to a noticeable degree.
Your stick looks fairly beefy, it should innately be quite strong (even if this were only pine it would still be quite strong). If it dries out successfully, without any bad cracks forming, the wood could end up strong, resilient and stable, more than able to withstand the forces you'll subject it to using it as a hiking stick.