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The sector likewise faced broader macro headwinds, including a more mindful policy background in China and worldwide risk-off belief driven by geopolitical tensions and higher energy costs. Thematic ETFs Struggled for the most part, particularly those linked to carbon and high-growth technology, as assessment pressures and international rate dynamics weighed on efficiency.
The petrochemical ETF substantially exceeded. Circulations in Q1 2026 were modest and extremely concentrated, showing selective allocation rather than broad market participation. Despite weak performance, ETFs tape-recorded $27.1 million in net inflows, with just a little number of items drawing in new capital. This indicates that investors were targeting particular exposures, while reducing or turning out of others.
Trading activity stayed constant, with average 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Many activity appears to have actually occurred in the secondary market, enabling financiers to change positions without considerable main creations or redemptions. While current geopolitical events have actually resulted in more financial pressure on GCC nations, the area remains resilient and well capitalized to deal with the circumstance.
In January, Boreas released its S&P Global High-end UCITS ETF, including a specific niche thematic exposure concentrated on international high-end and consumer 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 expected to introduce in April pending a last approval from ADX.
Q1 2026 showed some development associating with ETFs in the GCC. We expect more international and thematic ETFs to list in the GCC during 2026. While the dispute has impacted sentiment and costs during the quarter, it has actually driven more volume and interest in regional assets.
In spite of continuous geopolitical stress and security dangers across the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to demonstrate strength, preserving positive growth momentum over the last few years. While disputes in the broader area and worldwide economic unpredictability remain a structural restraint, GCC countries have actually so far limited their effect on domestic financial efficiency through strong financial positions, policy continuity, and sustained investment.
3.2 percent development in 2025, speeding up 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 towards more favorable total conditions.
Leading Operational Change in Modern GCCThe IMF's World Economic Outlook (October 2025) projects international growth reducing to 3.1 percent in 2026, with advanced 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 somewhat above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a relatively high-growth pocketprovided that local risk conditions remain included and reform momentum holds.
Data from the GCC Statistical Center reveal that non-oil sectors already represent more than 73 percent of total GDP, a share that has actually continued to increase as governments expand investment in services, infrastructure, and innovation. 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 technology and AI-related infrastructure.
Public-sector financial investment and reform remain main to sustaining this pattern. Policy steps focused on attracting foreign direct financial investment, reducing foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and minimize the area's direct exposure to oil price volatility. While hydrocarbons no longer control the growth outlook, oil revenues are anticipated to play a helpful function 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 forecasted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more positive general conditions.
The IMF's World Economic Outlook (October 2025) tasks global growth easing 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 put the area materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a reasonably high-growth pocketprovided that local danger conditions remain consisted of and reform momentum holds.

Data from the GCC Statistical Center show that non-oil sectors currently account for more than 73 percent of total GDP, a share that has continued to rise as governments broaden investment in services, facilities, and innovation. 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 financial investment in innovation and AI-related facilities.
Leading Operational Change in Modern GCCPublic-sector investment and reform stay main to sustaining this trend. Policy steps focused on attracting foreign direct financial investment, easing foreign ownership rules, expanding capital markets, and supporting private-sector participation continue to underpin non-oil growth and minimize the area's direct exposure to oil rate volatility. While hydrocarbons no longer dominate the development outlook, oil incomes are anticipated to play a helpful function in 2026.
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