Investing.com — Morgan Stanley has outlined four major forces it believes will shape the global macro landscape in 2026, arguing that a thematic approach remains essential in navigating market volatility and structural change.
The bank’s four key themes for this year are AI/Tech Diffusion, The Future of Energy, The Multipolar World, and Societal Shifts. Three of those themes are unchanged from last year, the firm notes, while Societal Shifts marks an evolution of its earlier Longevity theme.
“We see multiple trends driving broad societal impacts around the world, with effects felt across a surprisingly wide range of industries,” JPMorgan strategist Stephen Byrd said in a note.
“The ripple effects of AI-driven employment disruption/evolution, an aging population, changing consumer preferences, the drive for healthy longevity, and challenging demographics across many geographies will continue to matter for governments, economies, and corporates.”
Within its four themes, Morgan Stanley laid out 10 macro predictions for 2026.
1) Two worlds of LLM progress and AI adoption: The bank expects U.S. frontier large language models (LLMs) to make a major leap in capabilities in the first half of 2026, with Chinese competitors lagging in the same period. Concerns around adoption are seen turning into optimism by the second half as benefits become more visible.
2) Compute demand exceeds supply: Rising AI complexity and broader adoption are forecast to push demand for compute well beyond supply growth, with Morgan Stanley arguing the economics for large-scale AI infrastructure are increasingly attractive.
3) A robust U.S. policy agenda: The Trump administration is expected to act more aggressively than markets anticipate on securing critical minerals, boosting domestic manufacturing, increasing military spending focused on innovation, and lowering consumer costs.
4) AI tech transfer and national self-sufficiency: China is seen pressing the U.S. for broader AI technology access while accelerating its own push for “gross domestic intelligence,” with national gaps in AI capability shaping future trade dynamics.
“In response to predictions 1-3, China exerts pressure on the U.S. to permit more extensive AI technology transfer to China. Inequalities in AI capabilities at the national level can impact trade dynamics,” Byrd wrote.
5) The politics of energy: Rising global energy costs are likely to spark backlash against data-center expansion and drive policy support for low-cost and off-grid power solutions, the strategist said.
6) Convergence of AI and energy infrastructure: Major AI players are expected to take greater control over energy assets to secure reliable, low-cost power and improve efficiency through AI-driven optimization.
7) China manufacturing gains and U.S. re-shoring: China is projected to expand global share in tech-heavy manufacturing, while the U.S. benefits from a “re-shoring renaissance” as technology reduces the advantage of low-cost labor.
8) Latin America’s investment cycle: Policy shifts, geopolitics, and peak interest rates are seen pushing the region into a new investment-led growth phase rather than one driven by consumption, according to Morgan Stanley.
9) Re-skilling and AI job-loss intervention: Governments and corporations are expected to roll out large-scale re-skilling programs, alongside political responses to real or perceived AI-driven employment disruption.
10) ’Transformative AI’ reshaping the economy: By the second half of 2026, Morgan Stanley anticipates early signs of deflation across parts of the economy, higher capital spending, shifting asset valuations, and rising importance of assets that cannot be “replicated” by AI.