Morgan Stanley’s “Major Theme” is stick with metals — gold, silver, copper, and aluminium
Morgan Stanley identifies metals, particularly gold, silver, copper, and aluminium, as its "Major Theme" for 2026, following significant price increases in 2025. The bank forecasts continued momentum, driven by supportive macroeconomic factors, including anticipated rate cuts and strong demand for real assets. Gold is projected to reach $4,800 per ounce, while aluminium and copper are expected to benefit from supply constraints and rising demand linked to electrification. Despite potential short-term volatility, Morgan Stanley maintains a positive outlook for metals in 2026, citing tight supply-demand balances and ongoing geopolitical risks.
Key points:
- Metals soared in 2025. Silver more than doubled, gold and copper rallied >50% and aluminium gained ~26% — and early 2026 price action suggests momentum remains strong.
- But are metals markets overheated? After such incredible gains, investors are asking whether they’ve run too far, too fast — or if the demand drivers behind these rallies remain intact.
- This article tackles that question. We bring you Morgan Stanley’s latest insights and opinions on precious and base metals — if the bank is right, they still have further to run.
Precious and base metals were among the standout performers of 2025. Gold and silver surged as investors sought hard assets amid geopolitical uncertainty and falling yields, while copper and aluminium rode a powerful combination of supply constraints and structurally rising demand tied to electrification and energy transition themes.
| Metal | Price Type | Start 2025 | 9 Jan 2026 | Change | % Change |
|---|---|---|---|---|---|
| Aluminium | LME cash (USD/t) | $2,516.50 | $3,180 | +$663.50 | +26.4% |
| Copper | LME cash (USD/t) | $8,706 | $13,060 | +$4,354 | +50.0% |
| Gold | Spot (USD/oz) | $2,623.28 | $4,510.15 | +$1,887 | +71.9% |
| Silver | Spot (USD/oz) | $28.89 | $79.87 | +$50.98 | +176.4% |
Gold, silver, copper, aluminium — 2025 starting price, ending price, absolute change, percentage change
The obvious question now confronting investors is the million-dollar one: can the metals rally continue into 2026? 🤔
Morgan Stanley thinks it can. In its latest China and the Miners research note, the investment bank has doubled down on its positive view toward precious and base metals — a view it correctly held through 2025 — naming metals its “Major Theme” for the year ahead [1]. While short-term volatility is inevitable after such strong gains, the bank argues the fundamental backdrop remains substantially supportive.
Precious metals outlook
Morgan Stanley’s outlook for precious metals remains firmly skewed to the upside, particularly for gold and silver. Report authors Rahul Anand and Michael Stancliff highlight a rare alignment of macro forces supporting gold: anticipated rate cuts, persistent geopolitical risk, strong central-bank buying, and continued investor demand for real assets. These factors are combining to “skew precious metals price risks higher,” while falling interest rates and robust physical demand continue to provide structural support, the analysts note [1].
Gold vs $US spot chart, 9 January 2026
Morgan Stanley forecasts gold reaching US$4,800 per ounce by the fourth quarter of 2026, noting that central-bank and ETF demand remain key pillars of the bull case [1]. Importantly, the investment bank sees gold’s role evolving beyond a simple hedge against interest rates. The analysts argue that gold is increasingly behaving as a fiscal-risk hedge, benefiting from concerns around government debt and structural deficits in developed markets [2].
Silver vs $US spot chart, 9 January 2026
Silver, meanwhile, remains a high-conviction call despite its extraordinary run. Morgan Stanley notes that silver’s supply-demand balance remains tight, with inventories low and lease rates rising. China’s new export-licensing requirements are flagged as a further upside risk, reinforcing the bank’s view that silver “continues to break new highs amid low inventories” [1].
Base metals outlook
Morgan Stanley is equally constructive on select base metals, with aluminium and copper standing out as preferred exposures.
Aluminium remains favoured due to persistent supply constraints outside Indonesia and China’s capacity caps. The bank points to tight ex-China supply and rising regional premiums as evidence that physical markets remain undersupplied. Morgan Stanley expects aluminium prices to reach US$3,250 per tonne by the second quarter of 2026, supported by constrained production and steady demand [1].
Aluminium - LME Official Cash chart, 9 January 2026
Copper’s outlook is underpinned by a compelling mix of cyclical tightness and secular demand growth. While China’s property sector remains weak, Morgan Stanley argues that copper demand is increasingly driven by electrification, renewable energy, and digital infrastructure rather than traditional construction. “2025’s supply disruptions are spilling into 2026,” the bank notes, keeping ex-China markets tight even as global growth moderates [1].
Copper - LME Official Cash chart, 9 January 2026
In additional research, Morgan Stanley has highlighted copper’s ability to rally despite China’s slowdown, with policy-driven investment in electrification replacing construction as the primary demand driver. The bank also emphasised copper’s improving risk-adjusted profile, noting that secular demand may dampen volatility and reinforce its role as a transition-critical metal [2].
2026 vs metals — "a positive setup"
Stepping back, Morgan Stanley’s broader message is clear: the conditions that powered metals higher in 2025 have not disappeared.
The bank sees 2026 as a year supported by anticipated rate cuts, strong investor demand for real assets, and persistently tight supply-demand balances across key metals [1]. Low inventories, ongoing geopolitical risks, and structural demand from the energy transition all contribute to a positive medium-term setup.
While Morgan Stanley acknowledges near-term risks — including seasonal demand weakness, index rebalancing flows, and policy uncertainty — it maintains that metals remain one of the more compelling ways for investors to position for a world of lower real rates and rising fiscal pressures.
As the bank succinctly puts it, the outlook for metals remains “a positive set-up for 2026” [1]. After a stellar 2025, it appears Morgan Stanley’s message to investors is simple: stay the course.
Morgan Stanley's ASX metals pick 🧐
The investment bank presently has an "Overweight" rating on South32 (S32) — which offers investors exposure to silver and aluminium as well as several other base metals. Morgan Stanley notes S32's "commodity prices and sales volumes are its biggest value drivers", with potential upside directly attributed to stronger-than-expected commodity prices and success at the company's exploration projects [3].
References
[1] Morgan Stanley, China and the Miners, January 9, 2026.
[2] Morgan Stanley Wealth Management, Global Insights — Measuring Metals’ Momentum: As Gold Shines, Copper Charges, October 15, 2025.
[3] Morgan Stanley, South32 Ltd — Updating Estimates and Price Target, August 29 2025.
