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The sector likewise dealt with more comprehensive macro headwinds, consisting of a more mindful policy background in China and worldwide risk-off sentiment driven by geopolitical stress and greater energy rates. Thematic ETFs Struggled for the many part, especially those connected to carbon and high-growth innovation, as appraisal pressures and international rate dynamics weighed on efficiency.
The petrochemical ETF substantially outshined. Circulations in Q1 2026 were modest and highly focused, reflecting selective allotment instead of broad market participation. Despite weak performance, ETFs recorded $27.1 million in net inflows, with just a small number of products bring in brand-new capital. This suggests that financiers were targeting specific exposures, while minimizing or turning out of others.
Trading activity stayed steady, with typical 30-day volumes around 33,000 shares, concentrated in a handful of larger and more liquid ETFs. A lot of activity appears to have happened in the secondary market, making it possible for investors to adjust positions without substantial main productions or redemptions. While current geopolitical events have led to more monetary pressure on GCC nations, the region stays resilient and well capitalized to deal with the situation.
In January, Boreas introduced its S&P Global Luxury UCITS ETF, including a niche thematic exposure focused on worldwide luxury and consumer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some development connecting to ETFs in the GCC. We expect more worldwide and thematic ETFs to list in the GCC throughout 2026. While the conflict has actually impacted sentiment and prices during the quarter, it has driven more volume and interest in local assets.
Regardless of continuous geopolitical stress and security dangers across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate resilience, preserving positive development momentum recently. While conflicts in the wider area and worldwide financial unpredictability stay a structural restraint, GCC countries have so far limited their influence on domestic financial efficiency through strong financial positions, policy continuity, and sustained investment.
3.2 percent growth in 2025, speeding up 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, showing a shift toward more favorable general conditions.
The IMF's World Economic Outlook (October 2025) projects global development alleviating 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, reinforcing the GCC's status as a fairly high-growth pocketprovided that local risk conditions stay consisted of and reform momentum holds.
Data from the GCC Statistical Center show that non-oil sectors already account for more than 73 percent of overall GDP, a share that has continued to increase as governments broaden financial 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, improving credit conditions, and increasing investment in technology and AI-related infrastructure.
Public-sector financial investment and reform stay central to sustaining this trend. Policy measures focused on bring in foreign direct financial investment, alleviating foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and reduce the area's exposure to oil cost volatility. While hydrocarbons no longer dominate the development outlook, oil profits are anticipated to play a helpful function in 2026.
The World Bank, on the other hand, tasks 3.2 percent development in 2025, accelerating to 4.5 percent in 2026. The IMF Sees momentum improving, with GCC output development predicted to rise from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more favorable total conditions.
The IMF's World Economic Outlook (October 2025) projects worldwide development reducing 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 comparison, a 4.44.5 percent GCC expansion would place the area materially ahead of the world average and a little above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a relatively high-growth pocketprovided that regional risk conditions stay consisted of and reform momentum holds.
Information 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 rise as federal 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 investment in technology and AI-related facilities.
Public-sector financial investment and reform remain main to sustaining this pattern. Policy steps focused on drawing in foreign direct financial investment, easing foreign ownership rules, broadening capital markets, and supporting private-sector participation continue to underpin non-oil growth and reduce the area's exposure to oil cost volatility. While hydrocarbons no longer control the growth outlook, oil revenues are anticipated to play an encouraging role in 2026.
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