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The sector also faced wider macro headwinds, consisting of a more cautious policy background in China and worldwide risk-off sentiment driven by geopolitical tensions and greater energy prices. Thematic ETFs Struggled for the a lot of part, especially those linked to carbon and high-growth innovation, as valuation pressures and international rate characteristics weighed on performance.
The petrochemical ETF substantially surpassed. Flows in Q1 2026 were modest and extremely focused, showing selective allocation rather than broad market participation. In spite of weak performance, ETFs taped $27.1 million in net inflows, with only a small number of products bring in brand-new capital. This suggests that financiers were targeting particular direct exposures, while lowering or turning out of others.
Trading activity stayed stable, with typical 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Most activity appears to have actually taken place in the secondary market, making it possible for financiers to change positions without considerable primary creations or redemptions. While current geopolitical events have actually resulted in more financial pressure on GCC countries, the region stays resistant and well capitalized to handle the scenario.
In January, Boreas introduced its S&P Global Luxury UCITS ETF, including a niche thematic exposure focused on global high-end and customer brand names. ETFs by the CMA for cross-listing on ADX.
Q1 2026 revealed some development connecting to ETFs in the GCC. We anticipate more global and thematic ETFs to list in the GCC during 2026. While the dispute has affected belief and prices during the quarter, it has actually driven more volume and interest in local possessions.
In spite of ongoing geopolitical stress and security dangers across the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to show strength, keeping favorable development momentum recently. While disputes in the broader area and international financial uncertainty stay a structural restraint, GCC nations have so far restricted their effect on domestic financial efficiency through strong fiscal positions, policy continuity, and continual financial investment.
The World Bank, on the other hand, jobs 3.2 percent development in 2025, accelerating to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output growth forecasted to increase from 1.7 percent in 2024 to 3.3 percent usually in 2025, reflecting a shift toward more favorable total conditions.
The IMF's World Economic Outlook (October 2025) jobs international development reducing to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and establishing economies just above 4 percent. On that comparison, a 4.44.5 percent GCC growth would position the area materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a relatively high-growth pocketprovided that local threat conditions remain included and reform momentum holds.
Data from the GCC Statistical Center show that non-oil sectors already represent more than 73 percent of overall GDP, a share that has actually continued to increase as governments broaden financial investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity throughout the GCC is projected to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing financial investment in innovation and AI-related facilities.
Public-sector financial investment and reform stay main to sustaining this trend. Policy measures focused on drawing in foreign direct financial investment, easing foreign ownership guidelines, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and minimize the area's exposure to oil price volatility. While hydrocarbons no longer control the development outlook, oil revenues are expected to play a supportive role in 2026.
The World Bank, on the other hand, projects 3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output growth forecasted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) jobs worldwide growth alleviating to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and developing economies simply above 4 percent. On that contrast, a 4.44.5 percent GCC growth would put the region materially ahead of the world average and somewhat above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a fairly high-growth pocketprovided that local danger conditions remain consisted of and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors already account for more than 73 percent of overall GDP, a share that has continued to rise as governments broaden financial investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity across the GCC is forecasted to grow by around 4.1 percent in 2026, supported by strong labor markets, enhancing credit conditions, and rising financial investment in innovation and AI-related facilities.
Is Your GCC Outsourcing Strategy Ready for 2026?Public-sector financial investment and reform remain central to sustaining this pattern. Policy procedures focused on drawing in foreign direct financial investment, easing foreign ownership guidelines, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and minimize the region's direct exposure to oil rate volatility. While hydrocarbons no longer control the development outlook, oil earnings are expected to play an encouraging role in 2026.
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