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The sector also dealt with wider macro headwinds, including a more mindful policy backdrop in China and global risk-off belief driven by geopolitical stress and greater energy rates. Thematic ETFs Had a hard time for the most part, especially those connected to carbon and high-growth innovation, as appraisal pressures and global rate characteristics weighed on performance.
The petrochemical ETF significantly outshined. Circulations in Q1 2026 were modest and extremely focused, reflecting selective allocation instead of broad market involvement. Regardless of weak efficiency, ETFs taped $27.1 million in net inflows, with only a little number of products bring in new capital. This shows that financiers were targeting particular direct exposures, while reducing or rotating out of others.
Trading activity remained consistent, with typical 30-day volumes around 33,000 shares, focused in a handful of bigger and more liquid ETFs. A lot of activity appears to have taken place in the secondary market, allowing investors to change positions without significant primary creations or redemptions. While current geopolitical occasions have resulted in more financial pressure on GCC countries, the area stays durable and well capitalized to handle the situation.
In January, Boreas released its S&P Global High-end UCITS ETF, including a niche thematic exposure concentrated on international high-end and consumer brands. 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 release in April pending a final approval from ADX.
Q1 2026 revealed some development relating to ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC throughout 2026. While the conflict has affected sentiment and prices during the quarter, it has actually driven more volume and interest in local properties.
Regardless of continuous geopolitical stress and security risks throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to demonstrate resilience, preserving positive development momentum in the last few years. While disputes in the larger region and international economic uncertainty remain a structural restraint, GCC countries have actually so far restricted their influence on domestic financial performance through strong fiscal positions, policy connection, and sustained investment.
The World Bank, on the other hand, tasks 3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output growth predicted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more favorable total conditions.
The IMF's World Economic Outlook (October 2025) projects worldwide growth relieving to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and establishing economies simply above 4 percent. On that contrast, a 4.44.5 percent GCC growth would put 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 local danger conditions remain included and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors already represent more than 73 percent of overall GDP, a share that has continued to increase as governments expand investment in services, facilities, and technology. 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 rising financial investment in technology and AI-related facilities.
Public-sector investment and reform stay central to sustaining this trend. Policy measures targeted at drawing in foreign direct investment, relieving foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil growth and minimize the region's exposure to oil cost volatility. While hydrocarbons no longer dominate the growth outlook, oil revenues are anticipated to play an encouraging role in 2026.
3.2 percent development in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output growth projected to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift towards more favorable general conditions.
The IMF's World Economic Outlook (October 2025) jobs global development 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 contrast, a 4.44.5 percent GCC growth 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 reasonably high-growth pocketprovided that regional threat conditions remain contained and reform momentum holds.
Data from the GCC Statistical Center reveal that non-oil sectors currently represent more than 73 percent of total GDP, a share that has continued to increase as governments expand investment in services, infrastructure, 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 investment in innovation and AI-related infrastructure.
Essential Steps for Operational Excellence in DubaiPublic-sector investment and reform remain central to sustaining this pattern. Policy steps focused on drawing in foreign direct financial investment, alleviating foreign ownership guidelines, broadening capital markets, and supporting private-sector involvement continue to underpin non-oil growth and lower the region's exposure to oil rate volatility. While hydrocarbons no longer dominate the growth outlook, oil profits are expected to play a supportive role in 2026.
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