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The sector likewise dealt with broader macro headwinds, consisting of a more careful policy background in China and international risk-off sentiment driven by geopolitical stress and higher energy rates. Thematic ETFs also had a hard time for the most part, especially those linked to carbon and high-growth technology, as assessment pressures and worldwide rate characteristics weighed on performance.
The petrochemical ETF considerably exceeded. Circulations in Q1 2026 were modest and highly concentrated, showing selective allotment instead of broad market involvement. Despite weak efficiency, ETFs taped $27.1 million in net inflows, with just a small number of items drawing in brand-new capital. This indicates that investors were targeting specific direct exposures, while reducing or turning out of others.
Trading activity remained constant, with average 30-day volumes around 33,000 shares, focused in a handful of bigger and more liquid ETFs. Many activity appears to have actually taken place in the secondary market, enabling financiers to change positions without considerable main productions or redemptions. While current geopolitical events have resulted in more financial pressure on GCC nations, the region stays durable and well capitalized to handle the scenario.
In January, Boreas released its S&P Global High-end UCITS ETF, adding a niche thematic direct exposure focused on international luxury and consumer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some progress relating to ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC during 2026. While the conflict has affected belief and rates during the quarter, it has actually driven more volume and interest in local assets.
In spite of continuous geopolitical tensions and security threats across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate durability, maintaining positive development momentum recently. While disputes in the broader area and worldwide financial unpredictability remain a structural restriction, GCC nations have up until now limited their influence on domestic financial performance through strong fiscal positions, policy continuity, and sustained financial investment.
3.2 percent development in 2025, accelerating to 4.5 percent in 2026. Sees momentum improving, with GCC output growth predicted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift towards more favorable total conditions.
The IMF's World Economic Outlook (October 2025) jobs international growth reducing to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and establishing economies simply above 4 percent. On that contrast, a 4.44.5 percent GCC expansion would place the region 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 regional risk conditions stay contained and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors already represent more than 73 percent of overall GDP, a share that has actually continued to rise as federal governments expand investment in services, facilities, 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, enhancing credit conditions, and increasing investment in innovation and AI-related facilities.
Public-sector investment and reform stay main to sustaining this trend. Policy steps intended at bring in foreign direct financial investment, alleviating foreign ownership guidelines, broadening capital markets, and supporting private-sector involvement continue to underpin non-oil growth and minimize the region's direct exposure to oil cost volatility. While hydrocarbons no longer dominate the development outlook, oil incomes are expected to play an encouraging function in 2026.
The World Bank, on the other hand, jobs 3.2 percent growth in 2025, accelerating to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output growth projected to increase from 1.7 percent in 2024 to 3.3 percent typically in 2025, showing a shift toward more positive overall conditions.
The IMF's World Economic Outlook (October 2025) tasks global development easing to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC growth would put the area materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a fairly high-growth pocketprovided that regional threat conditions stay contained and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors currently represent more than 73 percent of total GDP, a share that has continued to rise as federal governments broaden investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity across the GCC is predicted 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 infrastructure.
The Shift Towards Outcome-Based Outsourcing in the GCCPublic-sector investment and reform remain central to sustaining this pattern. Policy steps focused on drawing in foreign direct investment, reducing foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil growth and minimize the region's direct exposure to oil rate volatility. While hydrocarbons no longer dominate the growth outlook, oil earnings are anticipated to play an encouraging function in 2026.
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