Core Viewpoint - Morgan Stanley holds a structurally bullish view on the metal market for 2026/27, particularly favoring copper, aluminum, gold, and silver, while being relatively cautious or bearish on zinc and nickel. The main drivers of the market include supply disruptions, global inventory mismatches, central bank gold purchases, and long-term demand from energy transition [2]. Metal Outlook Copper - Strongly bullish with a price forecast of $12,075 per ton in 2026, expecting a breakthrough of $12,000 per ton in the first half of 2026 [5]. - Core logic includes severe supply disruptions from major mines, a mismatch in global inventory, and resilient demand growth projected at 2.6% [13]. Aluminum - Initially bullish but expected to decline later, with a forecast of $2,913 per ton in 2026, followed by a drop to $2,675 per ton in 2027 [6]. Zinc - Bearish outlook with a forecast of $2,775 per ton in 2026 and $2,600 per ton in 2027, indicating a preference for short positions [7]. Nickel - Expected to remain in a range-bound market, with a price forecast of $15,300 per ton in 2026 [8]. Precious Metal Outlook Gold - Structurally bullish with a price forecast of $4,753 per ounce in 2026, driven by central bank purchases and resilient investor demand [10]. - The expected decline in interest rates is also seen as favorable for gold [10]. Silver - Expected to follow gold's upward trend, with a forecast of $56.3 per ounce in 2026 [11]. Platinum - Anticipated to trade at high levels, with a forecast of $1,669 per ounce in 2026 [14]. Palladium - Short-term risks are present, but the long-term outlook remains bearish, with a forecast of $1,150 per ounce in 2026 [15]. Market Dynamics - Supply disruptions from major mines like Grasberg and Kamoa-Kakula are causing tight supply conditions [13]. - Global copper inventory is heavily concentrated in the U.S., while other regions, especially LME, face low inventory levels [13]. - The demand from data centers and AI infrastructure may exceed expectations, providing upward pressure on copper prices [13]. Trading Strategies - Suggested strategies include zero-cost gold reverse ratio call spreads and discounted dual digital options to capture gold price increases while managing risk [18].