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The sector likewise dealt with wider macro headwinds, consisting of a more careful policy background in China and international risk-off sentiment driven by geopolitical tensions and higher energy rates. Thematic ETFs also struggled for the most part, particularly those linked to carbon and high-growth technology, as evaluation pressures and worldwide rate characteristics weighed on performance.
Flows in Q1 2026 were modest and highly concentrated, showing selective allotment rather than broad market participation. Despite weak efficiency, ETFs recorded $27.1 million in net inflows, with only a little number of items bring in brand-new capital.
Trading activity remained steady, 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 taken place in the secondary market, making it possible for financiers to change positions without significant main creations or redemptions. While recent geopolitical occasions have resulted in more monetary pressure on GCC countries, the region remains resilient and well capitalized to deal with the situation.
In January, Boreas introduced its S&P Global Luxury UCITS ETF, including a specific niche thematic direct exposure focused on worldwide high-end and customer brand names. ETFs by the CMA for cross-listing on ADX.
Q1 2026 revealed some progress associating with ETFs in the GCC. We anticipate more worldwide and thematic ETFs to list in the GCC during 2026. While the conflict has affected sentiment and prices during the quarter, it has driven more volume and interest in regional properties.
In spite of continuous geopolitical tensions and security dangers throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to show strength, maintaining positive growth momentum in recent years. While conflicts in the wider region and worldwide financial uncertainty remain a structural restraint, GCC nations have so far restricted their influence on domestic financial performance through strong financial positions, policy connection, and continual financial investment.
The World Bank, on the other hand, tasks 3.2 percent development in 2025, accelerating to 4.5 percent in 2026. The IMF similarly sees momentum improving, with GCC output growth forecasted to increase 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) tasks worldwide development alleviating to 3.1 percent in 2026, with innovative 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 position 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 reasonably high-growth pocketprovided that local risk conditions remain included and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors already represent more than 73 percent of overall GDP, a share that has continued to rise as federal governments broaden financial investment in services, infrastructure, and innovation. According to Oxford Economics, non-energy activity across the GCC is forecasted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and rising investment in technology and AI-related infrastructure.
Public-sector financial investment and reform remain central to sustaining this trend. Policy steps targeted at attracting foreign direct investment, reducing foreign ownership rules, broadening capital markets, and supporting private-sector participation continue to underpin non-oil growth and decrease the region's exposure to oil price volatility. While hydrocarbons no longer control the development outlook, oil incomes are expected to play an encouraging role in 2026.
The World Bank, on the other hand, jobs 3.2 percent growth in 2025, speeding up to 4.5 percent in 2026. The IMF likewise sees momentum improving, with GCC output growth projected to increase from 1.7 percent in 2024 to 3.3 percent typically in 2025, reflecting a shift towards more positive overall conditions.
The IMF's World Economic Outlook (October 2025) tasks worldwide growth reducing to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that contrast, 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, reinforcing the GCC's status as a reasonably high-growth pocketprovided that regional risk conditions remain included and reform momentum holds.
Data 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 federal governments expand 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, enhancing credit conditions, and rising investment in technology and AI-related infrastructure.
Public-sector investment and reform stay main to sustaining this pattern. Policy steps targeted at bring in foreign direct financial investment, alleviating foreign ownership guidelines, expanding capital markets, and supporting private-sector participation continue to underpin non-oil growth and reduce the region's exposure to oil rate volatility. While hydrocarbons no longer control the growth outlook, oil incomes are expected to play a helpful function in 2026.
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