Morgan Stanley is leaning heavily toward equities going into next year, projecting that U.S. stocks will outperform global peers in 2026 on the back of accelerating artificial intelligence investment and a policy backdrop it believes is finally aligning in favor of risk assets.

“Risk assets are primed for a strong 2026, powered by micro fundamentals, accelerating AI capex, and a favorable policy backdrop,” the bank said in a set of global economic and strategy outlook notes released Monday.

The view caps a turbulent year in global markets, shaped in no small part by President Donald Trump’s shifting tariff approach. Much of that uncertainty has eased heading into 2026, giving investors clearer visibility even as Morgan Stanley cautioned that the next 12 months still carry a wide range of possible outcomes. The U.S., it stressed, remains the central swing factor for global markets.

U.S. Outlook: AI, Earnings, and a Soft Dollar Cycle

Morgan Stanley’s baseline scenario sees the S&P 500 climbing to 7,800 by the end of 2026, implying roughly 16% upside from current levels. The bank attributes the projection to resilient earnings growth across major sectors and productivity gains tied to the rollout of AI-driven tools and infrastructure.

Small-cap stocks are expected to outperform large caps, while cyclicals should lead defensive sectors. The assessment reflects expectations of a Federal Reserve that remains dovish through much of 2026, enabling borrowing costs to stay supportive of growth.

On currencies, Morgan Stanley forecasts the dollar index sliding to 94 in the first half of next year before recovering to 99 by year-end as global growth patterns shift.

Europe: Riding the Coattails of a U.S. Upswing

The firm expects Europe to benefit from a widening U.S. recovery despite the region’s stubborn fiscal constraints and intensifying competition from China.

It raised its 2026 target for the MSCI Europe local currency index to 2,430, up from a prior forecast of 2,250. European stocks have already gained about 12.5% this year, buoyed by improved corporate earnings, easing inflation, and renewed optimism around Germany’s fiscal spending plans.

Still, Morgan Stanley noted that Europe’s structural challenges remain unresolved, making the region more dependent on U.S. momentum than in previous cycles.

Commodities: Gold Soars, Oil Anchored

The bank’s commodities outlook paints a sharply divergent landscape.

Gold is projected to hit $4,500 per ounce in 2026, reflecting expected demand for safe assets and a weaker early-year dollar. Copper is forecast at $10,600 per ton, supported by continued electrification demand and tight supply conditions.

By contrast, Brent crude is expected to hover around $60 a barrel. The brokerage anticipates a soft supply-demand balance through 2026, keeping oil prices capped even if global growth holds up.

A Wide Band of Possibilities

While the baseline is upbeat, Morgan Stanley flagged that uncertainty remains high as markets transition into a new policy and growth cycle shaped by AI, geopolitics, and post-pandemic economic rebalancing. The firm described the U.S. as the critical variable that could swing global markets either toward a sustained rally or back into volatility.

What remains clear, in its view, is that equities—not credit or government bonds—offer the most compelling opportunity next year, with artificial intelligence once again at the center of the global market story.

Dangote Cement Plc has formally launched the first tranche of its N500 billion Commercial Paper (CP) Issuance Programme, opening a N100 billion offer on Monday, 17 November 2025.

The offer, scheduled to close on Wednesday, 19 November 2025, marks a significant milestone for Nigeria’s leading cement producer, reflecting the company’s strong market position and financial stability.

The CPs are structured in two tranches: a 181-day Series 1 with a 16.10% discount rate, which implies a yield of 17.50%, and a 265-day Series 2 with a 16.70% discount rate, translating to a 19.00% yield. Minimum subscription is set at N50 million, with further subscriptions allowed in multiples of N1,000. According to the pricing documents, proceeds from the issuance will be directed toward meeting the company’s working capital needs, supporting operations across its extensive Pan-African footprint.

Dangote Cement’s financial track record over the past five years underscores its ability to deliver consistent results. Revenue surged from N1.03 trillion in 2020 to N3.58 trillion in 2024, reflecting a remarkable compound annual growth rate of 37%. Profit after tax more than doubled over the same period, climbing from N276 billion to N503.25 billion, signaling sustained operational efficiency and effective cost management.

The company’s performance through the first nine months of 2025 has been equally impressive. Revenue reached N3.15 trillion, up 22% from N2.56 trillion in the same period in 2024, while profit before tax soared 150% to N1.04 trillion from N406.4 billion. Profit after tax more than doubled to N743.3 billion from N279.1 billion in 9M 2024. Operating cash flows grew to N1.29 trillion, more than doubling the N532 billion recorded in the prior year. The company has also reduced its borrowings by 47%, from N2.5 trillion in December 2024 to N1.32 trillion, with its interest coverage ratio improving to 4.4 from 3.3, indicating a strengthened capacity to service debt.

However, Dangote Cement experienced a decline in production volume in 9 months of 2025, suggesting that pricing, rather than volume growth, has been the main driver of performance. Analysts caution that sustained reliance on pricing could present a risk if competitive or market pressures affect margins.

Rating agencies continue to recognize Dangote Cement’s strong market position and operational resilience, though with some caution. DataPro reaffirmed the company’s AA long-term and A1 short-term ratings, highlighting its strong brand, solid earnings track record, and experienced management team. At the same time, they noted risks, including low asset utilization, foreign-exchange exposure, and challenges across certain Pan-African markets.

GCR Ratings, in October 2025, downgraded the company to A+(NG) from AA+(NG), not due to deteriorating performance but because of the group-cap effect tied to its parent company, Dangote Industries Limited. GCR, however, acknowledged the company’s robust cash flows and solid earnings, forecasting continued improvement in leverage metrics by the end of 2025.

For investors, the CP issuance offers an attractive short-term investment opportunity. With strong revenue growth, surging profits, and robust operating cash flows, Dangote Cement demonstrates a capacity to deliver steady returns. The reduction in borrowings and improved leverage provide additional reassurance regarding the security of the CPs. At the same time, the yields of 17.5% for the shorter tranche and 19% for the longer tranche make the offering competitive relative to other fixed-income instruments available in Nigeria’s capital markets.

While the company’s overall fundamentals are strong, investors are mindful of certain risks. For instance, the decline in production volume highlights potential exposure to pricing pressures, which could impact future profitability. Additionally, operations in Pan-African markets carry inherent foreign-exchange and geopolitical risks that could influence earnings.

Overall, the launch of Dangote Cement’s N100 billion Commercial Paper tranche represents a significant opportunity for investors seeking short-term, high-yield instruments backed by one of Nigeria’s most financially sound and strategically positioned industrial companies. The strong cash flow generation, disciplined debt management, and proven profitability pinpoint the company’s capacity to navigate challenging market conditions while delivering competitive returns.

Nvidia’s upcoming quarterly earnings report, scheduled for Wednesday after market close, is poised to generate one of the largest single-day swings in market value ever for the AI-focused chipmaker, with analysts estimating a potential $320 billion fluctuation.

Investors are intensely focused on the report, seeking signals about whether the artificial intelligence boom is entering a new phase of growth or showing early signs of cooling, according to Reuters.

Options data from analytics firm Option Research & Technology Services (ORATS) indicate that the market is pricing in an approximately 7% movement in either direction for Nvidia shares following the earnings announcement. According to Reuters’ analysis, at Nvidia’s current market capitalization of around $4.6 trillion, such a move would surpass the $276 billion market value swing recorded in February 2024, marking the largest post-earnings market impact in the company’s history. Over the last 12 quarters, Nvidia’s stock has averaged a 7.3% change the day after reporting, ORATS data shows.

The earnings report carries outsized importance because Nvidia’s graphics processing units dominate the AI infrastructure market, powering large language models and other AI applications. Reuters quoted Chris Murphy, co-head of derivatives strategy at Susquehanna, as emphasizing that Nvidia’s results will influence expectations for AI investment more broadly.

“As the anchor of the AI capex trade, its results will help define whether we’re in the next leg of expansion or entering digestion mode,” Murphy said.

The chipmaker’s approximately 8% weighting in the S&P 500 amplifies the potential ripple effects of its earnings. Murphy explained that the report could influence sentiment across semiconductors, hyperscalers, and the broader AI infrastructure market, affecting more than $10 trillion of correlated trades. Investors will scrutinize Nvidia’s revenue, margins, demand trends, and supply chain updates for indications of how AI spending might evolve in the near term.

Recent market activity has highlighted investor caution. Nvidia shares, which have gained roughly 38% year-to-date, have retreated about 10% from record highs reached in late October. The decline coincides with high-profile investor exits, including billionaire Peter Thiel’s hedge fund and SoftBank, raising concerns about the sustainability of AI-driven gains. Analysts and fund managers are assessing whether these moves signal a temporary correction or a broader recalibration in AI stock valuations.

Jason Pride, chief of investment strategy and research at Glenmede, noted that Nvidia’s results could influence broader business investment trends.

“As a major S&P 500 constituent, its results will likely carry broader implications for business investment and AI-related spending trends,” he said, highlighting the central role of Nvidia’s report in guiding expectations for the technology sector.

The earnings release will be closely examined for multiple factors. Analysts are looking for clarity on AI demand, including enterprise adoption, cloud computing growth, and hyperscaler investment in data center capacity. Margins and supply chain performance are also critical, given the costs associated with producing next-generation GPUs and supporting the infrastructure needed for large-scale AI model training.

Investors are aware that Nvidia’s earnings report may influence market narratives as much as the stock itself. Beyond the immediate 7% move implied by options, the results could shape perceptions about the trajectory of AI as an industrial and investment trend, impacting valuations across the technology sector and informing capital allocation decisions globally.

In essence, Nvidia’s earnings are not just a financial report; they are seen as a pivotal moment for the AI ecosystem. Market participants will be watching closely to see whether the company can sustain its growth, manage costs, and deliver signals that justify its role as the anchor of the AI-driven technology boom. The report could set the tone for AI-related investment strategies and influence the broader semiconductor market for months to come.

Microsoft and Nvidia have announced a landmark strategic partnership with AI startup Anthropic, signaling a major step in reducing Microsoft’s reliance on OpenAI while accelerating the development of advanced AI models.

The collaboration, disclosed on Tuesday, comes with substantial financial commitments: Microsoft will invest up to $5 billion in Anthropic, while Nvidia will contribute up to $10 billion.

The investments have propelled Anthropic’s valuation to an estimated $350 billion, nearly doubling its $183 billion valuation in September. The exact terms of the next funding round are still being finalized, according to the companies.

Under the agreement, Anthropic has committed to purchasing $30 billion of compute capacity from Microsoft’s Azure cloud platform, with additional contracts for up to one gigawatt of compute capacity. Nvidia will supply Anthropic with up to one gigawatt of compute capacity using its Grace Blackwell and Vera Rubin systems. Nvidia CEO Jensen Huang described the partnership as “a dream come true” and noted that the companies will collaborate on optimizing Anthropic’s AI models for performance and efficiency while fine-tuning Nvidia’s architectures for Anthropic’s specific workloads.

Anthropic, founded in 2021 by former OpenAI executives, including CEO Dario Amodei, is best known for its Claude family of large language models. The company was initially backed by Amazon, with AWS serving as its primary cloud provider in 2023 and as its primary training partner in 2024. Microsoft and Nvidia’s new involvement adds a significant layer of strategic support, particularly in compute infrastructure and model optimization.

Microsoft’s move comes alongside its longstanding investment in OpenAI, which it has backed since 2019. OpenAI, originally a nonprofit research lab, has transformed into a commercial powerhouse with ChatGPT and other AI products. Microsoft holds an approximate 27% stake in OpenAI’s for-profit arm, valued at $135 billion.

Microsoft CEO Satya Nadella framed the partnership as a collaborative effort beyond competition. “As an industry, we really need to move beyond any type of zero sum narrative or winner take all hype,” Nadella said. “What’s required now is the hard work of building broad, durable capabilities together so that this technology can deliver real, tangible local success for every country, every sector and every customer. The opportunity is simply too big to approach any other way.”

The partnership highlights a growing trend of major tech firms diversifying their AI investments, balancing partnerships across multiple AI startups while expanding in-house capabilities. Analysts note that Anthropic’s large-scale compute requirements, backed by Microsoft and Nvidia, place the startup in line to compete directly with OpenAI and other leading AI developers in the enterprise and cloud AI markets.

Nvidia is set to report its third-quarter earnings on Wednesday, which may offer additional insight into how the company is capitalizing on AI infrastructure demand. Meanwhile, the Microsoft-Anthropic partnership underscores the intensifying arms race in AI, with hyperscalers investing heavily in both talent and computing resources to maintain a competitive edge.

This multi-billion-dollar collaboration signals that AI is increasingly viewed not just as a software innovation, but as a compute-intensive infrastructure challenge, which requires strategic partnerships and massive capital expenditure for scaling of its next-generation AI models.