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The sector also dealt with more comprehensive macro headwinds, consisting of a more careful policy backdrop in China and international risk-off sentiment driven by geopolitical tensions and higher energy costs. Thematic ETFs likewise struggled for the most part, especially those linked to carbon and high-growth innovation, as valuation pressures and worldwide rate characteristics weighed on performance.
The petrochemical ETF substantially outperformed. Circulations in Q1 2026 were modest and highly concentrated, reflecting selective allocation instead of broad market involvement. In spite of weak efficiency, ETFs taped $27.1 million in net inflows, with only a little number of products drawing in new capital. This shows that financiers were targeting specific exposures, while minimizing or turning out of others.
Trading activity remained consistent, with typical 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. A lot of activity appears to have happened in the secondary market, enabling financiers to change positions without substantial primary creations or redemptions. While recent geopolitical occasions have actually resulted in more monetary pressure on GCC countries, the area stays durable and well capitalized to deal with the circumstance.
In January, Boreas released its S&P Global Luxury UCITS ETF, including a niche thematic direct exposure focused on worldwide luxury and customer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some progress connecting to ETFs in the GCC. We anticipate more international and thematic ETFs to list in the GCC during 2026. While the conflict has affected sentiment and rates throughout the quarter, it has actually driven more volume and interest in local properties.
Despite ongoing geopolitical tensions and security risks across the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to show strength, preserving favorable development momentum recently. While conflicts in the wider area and global financial uncertainty remain a structural restraint, GCC nations have so far restricted their effect on domestic financial efficiency through strong financial positions, policy connection, and sustained financial investment.
3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output growth forecasted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more positive overall conditions.
The IMF's World Economic Outlook (October 2025) jobs global development alleviating 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 comparison, a 4.44.5 percent GCC expansion would put the region 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 already account for more than 73 percent of overall GDP, a share that has continued to rise as governments expand investment in services, facilities, and technology. According to Oxford Economics, non-energy activity throughout the GCC is predicted to grow by around 4.1 percent in 2026, supported by strong labor markets, enhancing credit conditions, and rising investment in technology and AI-related infrastructure.
Public-sector financial investment and reform remain main to sustaining this trend. Policy measures targeted at attracting foreign direct investment, relieving foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and decrease the area's exposure to oil rate volatility. While hydrocarbons no longer dominate the development outlook, oil earnings are anticipated to play a helpful function in 2026.
3.2 percent development in 2025, accelerating to 4.5 percent in 2026. Sees momentum improving, with GCC output growth forecasted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) projects global development relieving 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 slightly above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a fairly high-growth pocketprovided that local risk conditions remain included and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors currently account for more than 73 percent of total GDP, a share that has actually continued to increase as federal governments expand investment in services, facilities, and technology. According to Oxford Economics, non-energy activity throughout the GCC is forecasted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and rising investment in technology and AI-related facilities.
Why Performance Is the Key Focus for UAE TalentPublic-sector financial investment and reform stay main to sustaining this pattern. Policy steps focused on drawing in foreign direct financial investment, easing foreign ownership guidelines, broadening capital markets, and supporting private-sector involvement continue to underpin non-oil growth and reduce the area's direct exposure to oil cost volatility. While hydrocarbons no longer dominate the growth outlook, oil revenues are anticipated to play an encouraging function in 2026.
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