Morgan Stanley reiterated its call for gold, silver, corn and
soybeans to outperform other raw materials as a weaker U.S. dollar and
investor demand bolster precious metals and supply curbs support grains.
Silver will track higher prices in gold, which is poised to rally on
low real interest rates, buying by central banks and more geopolitical
uncertainty, analysts including Peter Richardson and Hussein
Allidina wrote in a report today. Corn and soybeans should benefit from
production delays in South America, they said. The bank is bearish on
aluminum, nickel, sugar and uranium as supplies are set to outpace
demand.
Commodities tracked by the Standard & Poor’s GSCI Spot Index are
down 0.4 percent this year, led by declines in coffee, cotton and sugar.
The gauge nearly doubled in the three years to 2011 as central banks
and governments around the world took action to boost their economies
hurt by the global financial crisis in 2008. Morgan Stanley joins
Goldman Sachs Group Inc. in predicting the so-called super-cycle isn’t
over.
“Higher prices in recent years have brought both a supply and demand
response, bringing many to call for the end” of the super-cycle, the
analysts wrote. “We view this as too simplistic. Commodities are
cyclical, but the elasticity of supply and demand, as well as the length
of the cycle, vary significantly across the complex.” (more)
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