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The sector likewise faced more comprehensive macro headwinds, including a more cautious 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 evaluation pressures and worldwide rate dynamics weighed on efficiency.
The petrochemical ETF substantially outshined. Circulations in Q1 2026 were modest and extremely concentrated, reflecting selective allowance rather than broad market participation. Regardless of weak performance, ETFs recorded $27.1 million in net inflows, with only a little number of products drawing in brand-new capital. This suggests that investors were targeting particular exposures, while reducing or turning out of others.
Trading activity stayed constant, with average 30-day volumes around 33,000 shares, focused in a handful of bigger and more liquid ETFs. Most activity appears to have actually happened in the secondary market, enabling financiers to adjust positions without significant main productions or redemptions. While recent geopolitical events have led to more financial pressure on GCC countries, the region remains durable and well capitalized to handle the situation.
In January, Boreas launched its S&P Global Luxury UCITS ETF, adding a niche thematic direct exposure focused on international high-end and customer brand names. Momentum continued into April with the approval of KraneShares AGIX and KWIN ETFs by the CMA for cross-listing on ADX. These funds are anticipated to release in April pending a final approval from ADX.
Q1 2026 revealed some development associating with ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC throughout 2026. While the dispute has affected sentiment and costs during the quarter, it has actually driven more volume and interest in local assets.
Regardless of continuous geopolitical tensions and security risks across the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to show strength, keeping positive development momentum in the last few years. While conflicts in the larger area and global economic uncertainty remain a structural restriction, GCC nations have actually up until now limited their impact on domestic financial efficiency through strong fiscal positions, policy continuity, and sustained financial 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 toward more favorable total conditions.
The IMF's World Economic Outlook (October 2025) jobs worldwide development relieving to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and developing economies simply above 4 percent. On that comparison, a 4.44.5 percent GCC expansion would put the region 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 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 total GDP, a share that has actually continued to rise as federal 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 innovation and AI-related facilities.
Public-sector financial investment and reform remain main to sustaining this pattern. Policy procedures targeted at bring in foreign direct financial investment, reducing 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 control the growth outlook, oil profits are expected to play an encouraging role in 2026.
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, reflecting a shift towards more positive general conditions.
The IMF's World Economic Outlook (October 2025) tasks international development alleviating to 3.1 percent in 2026, with sophisticated 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 area materially ahead of the world average and somewhat above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a fairly high-growth pocketprovided that regional risk conditions stay contained and reform momentum holds.
Data from the GCC Statistical Center show that non-oil sectors currently account for more than 73 percent of overall GDP, a share that has actually continued to increase as governments broaden financial investment in services, infrastructure, 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, improving credit conditions, and increasing financial investment in technology and AI-related infrastructure.
Public-sector investment and reform stay central to sustaining this trend. Policy steps focused on bring in foreign direct investment, alleviating foreign ownership rules, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and reduce the area's direct exposure to oil price volatility. While hydrocarbons no longer dominate the growth outlook, oil incomes are expected to play a helpful function in 2026.
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