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The sector also dealt with wider macro headwinds, consisting of a more cautious policy backdrop in China and global risk-off belief driven by geopolitical tensions and higher energy rates. Thematic ETFs likewise had a hard time for the a lot of part, especially those connected to carbon and high-growth innovation, as valuation pressures and international rate dynamics weighed on performance.
The petrochemical ETF considerably surpassed. Circulations in Q1 2026 were modest and extremely focused, reflecting selective allocation rather than broad market involvement. Regardless of weak performance, ETFs taped $27.1 million in net inflows, with just a small number of products drawing in new capital. This shows that financiers were targeting particular direct exposures, while minimizing or rotating out of others.
Trading activity remained steady, with average 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Many activity appears to have happened in the secondary market, making it possible for investors to adjust positions without considerable primary productions or redemptions. While recent geopolitical occasions have led to more financial pressure on GCC countries, the area stays resilient and well capitalized to deal with the scenario.
In January, Boreas released its S&P Global Luxury UCITS ETF, adding a niche thematic direct exposure concentrated on global luxury and customer brand names. Momentum continued into April with the approval of KraneShares AGIX and KWIN ETFs by the CMA for cross-listing on ADX. These funds are anticipated to introduce in April pending a final approval from 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 dispute has actually impacted belief and costs during the quarter, it has driven more volume and interest in regional assets.
Regardless of continuous geopolitical stress and security dangers across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to show durability, preserving favorable development momentum recently. While disputes in the larger region and international financial uncertainty stay a structural restriction, GCC countries have actually so far limited their impact on domestic economic efficiency through strong financial positions, policy continuity, and sustained financial investment.
3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output development predicted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift towards more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) jobs global 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 expansion would put the area 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 reasonably high-growth pocketprovided that local threat conditions remain consisted of and reform momentum holds.
Data from the GCC Statistical Center reveal that non-oil sectors currently account for more than 73 percent of overall GDP, a share that has continued to rise as governments expand financial investment in services, facilities, 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, enhancing credit conditions, and increasing financial investment in innovation and AI-related facilities.
Public-sector investment and reform remain central to sustaining this trend. Policy procedures intended at attracting foreign direct investment, reducing foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and lower the area's exposure to oil price volatility. While hydrocarbons no longer dominate the development outlook, oil profits are expected to play an encouraging function in 2026.
The World Bank, on the other hand, tasks 3.2 percent growth in 2025, accelerating to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output growth projected to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more positive total conditions.
The IMF's World Economic Outlook (October 2025) jobs worldwide development relieving 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 comparison, a 4.44.5 percent GCC expansion would place the area materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, strengthening the GCC's status as a relatively high-growth pocketprovided that local threat conditions remain contained and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors currently account for more than 73 percent of overall GDP, a share that has continued to rise as federal governments broaden financial investment in services, infrastructure, 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 financial investment in technology and AI-related infrastructure.
The Strategic Advantages of Deep Market ResearchPublic-sector financial investment and reform remain central to sustaining this pattern. Policy procedures intended at drawing in foreign direct investment, reducing foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil growth and lower the region's direct exposure to oil cost volatility. While hydrocarbons no longer dominate the growth outlook, oil profits are expected to play an encouraging role in 2026.
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