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The sector likewise faced broader macro headwinds, including a more cautious policy background in China and global risk-off sentiment driven by geopolitical tensions and higher energy rates. Thematic ETFs also struggled for the a lot of part, especially those connected to carbon and high-growth technology, as valuation pressures and worldwide rate dynamics weighed on efficiency.
The petrochemical ETF substantially surpassed. Circulations in Q1 2026 were modest and highly concentrated, reflecting selective allotment instead of broad market involvement. In spite of weak performance, ETFs tape-recorded $27.1 million in net inflows, with only a small number of items drawing in brand-new capital. This indicates that investors were targeting particular direct exposures, while reducing or rotating out of others.
Trading activity remained stable, with average 30-day volumes around 33,000 shares, focused in a handful of bigger and more liquid ETFs. A lot of activity appears to have actually taken place in the secondary market, enabling financiers to change positions without considerable primary developments or redemptions. While recent geopolitical events have actually resulted in more financial pressure on GCC nations, the region stays resilient and well capitalized to deal with the circumstance.
In January, Boreas introduced its S&P Global High-end UCITS ETF, including a niche thematic direct exposure focused on worldwide luxury and consumer brand names. ETFs by the CMA for cross-listing on ADX.
Q1 2026 revealed some progress connecting to ETFs in the GCC. We expect more global and thematic ETFs to list in the GCC throughout 2026. While the conflict has actually affected belief and rates during the quarter, it has actually driven more volume and interest in regional properties.
Despite continuous geopolitical tensions and security risks throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate resilience, preserving positive growth momentum in the last few years. While disputes in the broader region and global financial uncertainty remain a structural restraint, GCC countries have so far limited their effect on domestic financial efficiency through strong financial positions, policy connection, and sustained investment.
The World Bank, on the other hand, jobs 3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output development projected to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more favorable total conditions.
Finding Success in Saudi Arabia's Emerging Secondary CitiesThe IMF's World Economic Outlook (October 2025) jobs worldwide growth 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 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 fairly high-growth pocketprovided that regional risk conditions stay consisted of and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors currently represent more than 73 percent of total GDP, a share that has continued to increase as governments broaden investment in services, facilities, and innovation. 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, improving credit conditions, and increasing financial investment in innovation and AI-related infrastructure.
Public-sector financial investment and reform stay central to sustaining this pattern. Policy procedures targeted at drawing in foreign direct investment, relieving foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil growth and decrease the region's exposure to oil cost volatility. While hydrocarbons no longer control the development outlook, oil profits are expected to play an encouraging function in 2026.
3.2 percent growth in 2025, accelerating to 4.5 percent in 2026. Sees momentum improving, with GCC output growth predicted 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) projects worldwide 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 expansion would position 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 regional danger conditions stay 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 rise as governments expand investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity across the GCC is predicted to grow by around 4.1 percent in 2026, supported by strong labor markets, enhancing credit conditions, and rising financial investment in technology and AI-related facilities.
Public-sector financial investment and reform remain central to sustaining this trend. Policy steps focused on attracting foreign direct investment, relieving 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 cost volatility. While hydrocarbons no longer control the development outlook, oil incomes are expected to play an encouraging function in 2026.
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