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The sector likewise dealt with more comprehensive macro headwinds, including a more cautious policy background in China and worldwide risk-off sentiment driven by geopolitical stress and greater energy prices. Thematic ETFs also struggled for the a lot of part, especially those connected to carbon and high-growth innovation, as assessment pressures and worldwide rate characteristics weighed on performance.
The petrochemical ETF considerably outperformed. Flows in Q1 2026 were modest and extremely focused, showing selective allowance rather than broad market participation. Despite weak efficiency, ETFs tape-recorded $27.1 million in net inflows, with only a little number of products attracting brand-new capital. This shows that investors were targeting particular direct exposures, while reducing or rotating 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. Many activity appears to have actually taken place in the secondary market, allowing financiers to change positions without considerable primary developments or redemptions.
In January, Boreas released its S&P Global High-end UCITS ETF, adding a niche thematic direct exposure focused on global luxury and customer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some development associating with ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC throughout 2026. While the conflict has impacted belief and costs throughout the quarter, it has actually driven more volume and interest in regional assets.
Regardless of ongoing geopolitical tensions and security risks across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate durability, maintaining positive development momentum in the last few years. While conflicts in the larger region and worldwide economic uncertainty remain a structural restriction, GCC countries have actually up until now restricted their influence on domestic economic performance through strong financial positions, policy connection, and continual investment.
3.2 percent development in 2025, accelerating to 4.5 percent in 2026. Sees momentum improving, with GCC output development predicted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more positive general conditions.
Bridging Strategy and Operational Performance Across the GulfThe IMF's World Economic Outlook (October 2025) tasks international growth alleviating to 3.1 percent in 2026, with advanced economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC expansion would place the area materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a reasonably high-growth pocketprovided that local threat conditions remain included and reform momentum holds.
Data from the GCC Statistical Center show that non-oil sectors currently represent more than 73 percent of total GDP, a share that has actually continued to increase as governments expand 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, improving credit conditions, and increasing financial investment in innovation and AI-related facilities.
Public-sector investment and reform stay main to sustaining this trend. Policy measures focused on bring in foreign direct financial investment, relieving foreign ownership guidelines, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and lower the area's exposure to oil cost volatility. While hydrocarbons no longer control the development outlook, oil incomes are anticipated to play a helpful role in 2026.
The World Bank, on the other hand, projects 3.2 percent development in 2025, accelerating to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output development projected to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift toward more favorable general conditions.
The IMF's World Economic Outlook (October 2025) jobs global growth alleviating to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and establishing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC growth would place the area materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, strengthening the GCC's status as a reasonably high-growth pocketprovided that regional risk conditions remain consisted of and reform momentum holds.

Data from the GCC Statistical Center reveal that non-oil sectors already account for more than 73 percent of total GDP, a share that has continued to increase as federal governments broaden investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity across the GCC is projected to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and rising financial investment in technology and AI-related infrastructure.
Public-sector investment and reform remain central to sustaining this pattern. Policy procedures focused on bring in foreign direct investment, relieving foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and reduce the area's exposure to oil cost volatility. While hydrocarbons no longer dominate the growth outlook, oil earnings are expected to play an encouraging function in 2026.
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