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The sector also dealt with broader macro headwinds, including a more mindful policy background in China and global risk-off belief driven by geopolitical tensions and greater energy costs. Thematic ETFs also had a hard time for the many part, particularly those connected to carbon and high-growth technology, as assessment pressures and global rate dynamics weighed on efficiency.
The petrochemical ETF considerably exceeded. Flows in Q1 2026 were modest and extremely concentrated, reflecting selective allowance rather than broad market involvement. In spite of weak performance, ETFs recorded $27.1 million in net inflows, with just a small number of items drawing in new capital. This indicates that financiers were targeting specific exposures, while minimizing or rotating out of others.
Trading activity stayed stable, with average 30-day volumes around 33,000 shares, concentrated in a handful of larger and more liquid ETFs. A lot of activity appears to have actually taken location in the secondary market, enabling investors to change positions without significant primary creations or redemptions. While current geopolitical occasions have resulted in more financial pressure on GCC countries, the region remains durable and well capitalized to deal with the scenario.
In January, Boreas launched its S&P Global Luxury UCITS ETF, including a specific niche thematic exposure focused on global high-end and customer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some progress 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 prices throughout the quarter, it has driven more volume and interest in local possessions.
Regardless of continuous geopolitical stress and security threats throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate resilience, preserving favorable growth momentum in recent years. While disputes in the larger area and global economic uncertainty stay a structural constraint, GCC nations have actually so far limited their effect on domestic financial efficiency through strong fiscal positions, policy connection, and continual investment.
The World Bank, on the other hand, tasks 3.2 percent development in 2025, accelerating to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output development forecasted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift toward more positive overall conditions.
The IMF's World Economic Outlook (October 2025) jobs global development easing to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that comparison, 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 included 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 rise as governments expand 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 rising financial investment in innovation and AI-related infrastructure.
Public-sector investment and reform remain main to sustaining this trend. Policy steps focused on attracting foreign direct investment, easing foreign ownership rules, expanding capital markets, and supporting private-sector participation continue to underpin non-oil expansion and lower the region's exposure to oil rate volatility. While hydrocarbons no longer dominate the development outlook, oil incomes are expected to play a supportive role in 2026.
The World Bank, on the other hand, jobs 3.2 percent development in 2025, speeding up 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 towards more favorable total conditions.
The IMF's World Economic Outlook (October 2025) jobs worldwide growth relieving 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 comparison, a 4.44.5 percent GCC growth would position the region 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 local danger conditions remain included and reform momentum holds.
Data from the GCC Statistical Center show that non-oil sectors already account for more than 73 percent of total GDP, a share that has actually continued to rise as federal governments broaden financial investment in services, facilities, and innovation. 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 increasing investment in technology and AI-related infrastructure.
Why 2026 Needs a New Technique to Regional OutsourcingPublic-sector investment and reform remain main to sustaining this pattern. Policy procedures focused on attracting foreign direct investment, reducing foreign ownership rules, expanding capital markets, and supporting private-sector participation continue to underpin non-oil expansion and reduce the area's direct exposure to oil cost volatility. While hydrocarbons no longer dominate the growth outlook, oil earnings are expected to play a helpful function in 2026.
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