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The sector likewise dealt with wider macro headwinds, including a more cautious policy background in China and global risk-off belief driven by geopolitical tensions and higher energy costs. Thematic ETFs Struggled for the a lot of part, especially those connected to carbon and high-growth technology, as evaluation pressures and international rate dynamics weighed on performance.
The petrochemical ETF substantially exceeded. Flows in Q1 2026 were modest and highly concentrated, showing selective allotment instead of broad market participation. Despite weak efficiency, ETFs recorded $27.1 million in net inflows, with only a small number of products bring in brand-new capital. This suggests that investors were targeting particular exposures, while minimizing or turning out of others.
Trading activity remained constant, with typical 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Many activity appears to have actually occurred in the secondary market, allowing investors to change positions without substantial primary creations or redemptions. While recent geopolitical events have actually led to more monetary pressure on GCC nations, the region stays resistant and well capitalized to deal with the circumstance.
In January, Boreas introduced its S&P Global High-end UCITS ETF, adding a niche thematic exposure focused on worldwide 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 last approval from ADX.
Q1 2026 showed 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 impacted sentiment and rates throughout the quarter, it has driven more volume and interest in local properties.
In spite of ongoing geopolitical stress and security risks across the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to show strength, preserving favorable development momentum over the last few years. While conflicts in the broader area and global economic uncertainty stay a structural constraint, GCC countries have so far limited their influence on domestic economic performance through strong fiscal positions, policy connection, and sustained financial investment.
3.2 percent development in 2025, speeding up to 4.5 percent in 2026. 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 positive total conditions.
Leading the 2026 Regional Economic Environment for LeadersThe IMF's World Economic Outlook (October 2025) jobs global development reducing 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 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 local danger conditions remain included 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 federal governments broaden financial investment in services, infrastructure, and innovation. According to Oxford Economics, non-energy activity across 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 investment and reform stay main to sustaining this trend. Policy procedures targeted at bring in foreign direct financial investment, easing foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and minimize the area's exposure to oil price volatility. While hydrocarbons no longer dominate the development outlook, oil revenues are expected to play a helpful 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 toward more favorable total conditions.
The IMF's World Economic Outlook (October 2025) jobs worldwide growth easing 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 place the area 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 fairly high-growth pocketprovided that local risk conditions remain included and reform momentum holds.

Information from the GCC Statistical Center show that non-oil sectors already account for more than 73 percent of total GDP, a share that has continued to rise as governments broaden financial investment in services, infrastructure, and innovation. According to Oxford Economics, non-energy activity throughout the GCC is forecasted 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.
Essential GCC Business Research Insights in 2026Public-sector investment and reform remain main to sustaining this pattern. Policy procedures focused on attracting foreign direct financial investment, alleviating foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil expansion and lower the region's exposure to oil rate volatility. While hydrocarbons no longer control the growth outlook, oil profits are expected to play an encouraging function in 2026.
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