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The sector likewise faced broader macro headwinds, consisting of a more mindful policy background in China and global risk-off sentiment driven by geopolitical tensions and higher energy rates. Thematic ETFs Struggled for the most part, especially those linked to carbon and high-growth technology, as valuation pressures and worldwide rate characteristics weighed on efficiency.
The petrochemical ETF considerably outperformed. Flows in Q1 2026 were modest and highly concentrated, showing selective allocation rather than broad market involvement. In spite of weak efficiency, ETFs taped $27.1 million in net inflows, with just a little number of items attracting new capital. This indicates that investors were targeting particular exposures, while decreasing or turning out of others.
Trading activity remained stable, with average 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. Many activity appears to have taken location in the secondary market, enabling financiers to change positions without significant main creations or redemptions.
In January, Boreas launched its S&P Global High-end UCITS ETF, adding a niche thematic direct exposure focused on global high-end and customer brands. ETFs by the CMA for cross-listing on ADX.
Q1 2026 showed some development connecting to ETFs in the GCC. We expect more global and thematic ETFs to list in the GCC during 2026. While the conflict has affected belief and rates during the quarter, it has actually driven more volume and interest in local assets.
Despite continuous geopolitical stress and security risks throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have actually continued to demonstrate durability, maintaining positive growth momentum in recent years. While conflicts in the larger region and global economic uncertainty stay a structural restriction, GCC countries have so far restricted their effect on domestic financial performance through strong fiscal positions, policy connection, and continual financial investment.
3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output development forecasted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift toward more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) tasks global development alleviating to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and establishing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC expansion would position 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 reasonably high-growth pocketprovided that regional danger conditions stay contained and reform momentum holds.
Data from the GCC Statistical Center reveal that non-oil sectors already account for more than 73 percent of overall GDP, a share that has continued to rise as governments broaden financial investment in services, facilities, and innovation. According to Oxford Economics, non-energy activity across the GCC is predicted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing financial investment in innovation and AI-related facilities.
Public-sector financial investment and reform stay central to sustaining this trend. Policy steps focused on drawing in foreign direct financial investment, easing foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil expansion and lower the area's exposure to oil cost volatility. While hydrocarbons no longer dominate the development outlook, oil revenues are anticipated to play a helpful role in 2026.
3.2 percent growth in 2025, accelerating 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, reflecting a shift towards more positive total conditions.
The IMF's World Economic Outlook (October 2025) projects global growth 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 contrast, a 4.44.5 percent GCC growth would position 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 reasonably high-growth pocketprovided that regional danger 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 rise as federal governments expand 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 investment in innovation and AI-related facilities.
Public-sector investment and reform remain main to sustaining this trend. Policy steps targeted at attracting foreign direct financial investment, relieving foreign ownership rules, broadening capital markets, and supporting private-sector involvement continue to underpin non-oil expansion and decrease the region's exposure to oil cost volatility. While hydrocarbons no longer control the development outlook, oil earnings are expected to play a supportive role in 2026.
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