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The sector also dealt with broader macro headwinds, including a more mindful policy backdrop in China and global risk-off sentiment driven by geopolitical tensions and higher energy rates. Thematic ETFs also had a hard time for the many part, especially those linked to carbon and high-growth technology, as appraisal pressures and global rate dynamics weighed on performance.
Flows in Q1 2026 were modest and highly focused, reflecting selective allocation rather than broad market involvement. Despite weak performance, ETFs recorded $27.1 million in net inflows, with just a small number of items bring in brand-new capital.
Trading activity remained constant, with typical 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Most activity appears to have actually taken location in the secondary market, allowing investors to adjust positions without significant main developments or redemptions.
In January, Boreas introduced its S&P Global Luxury UCITS ETF, including a specific niche thematic direct exposure focused on international luxury and consumer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some development associating with ETFs in the GCC. We expect more global and thematic ETFs to list in the GCC during 2026. While the conflict has actually affected belief and rates during the quarter, it has actually driven more volume and interest in local possessions.
Regardless of ongoing geopolitical tensions and security dangers throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to demonstrate resilience, keeping favorable growth momentum in the last few years. While conflicts in the broader region and global financial unpredictability stay a structural constraint, GCC countries have actually up until now limited their impact on domestic economic performance through strong financial positions, policy connection, and continual investment.
3.2 percent development 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 towards more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) projects global development relieving 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 growth would place the region materially ahead of the world average and somewhat above (or broadly in line with) the emerging-market aggregate, strengthening the GCC's status as a fairly high-growth pocketprovided that regional risk 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 increase as federal governments broaden financial 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, improving credit conditions, and rising financial investment in technology and AI-related infrastructure.
Public-sector investment and reform stay central to sustaining this pattern. Policy measures intended at bring in 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 price volatility. While hydrocarbons no longer control the growth outlook, oil revenues are expected to play a helpful role 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 similarly sees momentum improving, with GCC output growth predicted to increase 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) tasks international growth relieving 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 place the region 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 regional risk conditions remain consisted of and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors currently represent more than 73 percent of overall GDP, a share that has actually continued to increase as governments broaden financial investment in services, facilities, 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 rising investment in innovation and AI-related infrastructure.
Traditional Vs Modern Strategy Within the MENA MarketPublic-sector investment and reform remain central to sustaining this trend. Policy steps focused on attracting foreign direct investment, alleviating foreign ownership rules, broadening capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and minimize the area's direct exposure to oil price volatility. While hydrocarbons no longer control the growth outlook, oil incomes are expected to play an encouraging function in 2026.
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