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The sector also faced wider macro headwinds, consisting of a more cautious policy backdrop in China and international risk-off belief driven by geopolitical stress and higher energy rates. Thematic ETFs also struggled for the most part, especially those connected to carbon and high-growth technology, as valuation pressures and international rate dynamics weighed on efficiency.
The petrochemical ETF substantially exceeded. Circulations in Q1 2026 were modest and highly concentrated, reflecting selective allocation rather than broad market involvement. In spite of weak performance, 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 stayed consistent, with average 30-day volumes around 33,000 shares, focused in a handful of larger and more liquid ETFs. A lot of activity appears to have occurred in the secondary market, allowing investors to change positions without significant primary creations or redemptions. While recent geopolitical events have resulted in more financial pressure on GCC nations, the region remains resistant and well capitalized to deal with the scenario.
In January, Boreas released its S&P Global Luxury UCITS ETF, adding a specific niche thematic direct exposure concentrated on international luxury and customer 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 launch in April pending a last approval from ADX.
Q1 2026 revealed some development connecting to ETFs in the GCC. We anticipate more global and thematic ETFs to list in the GCC during 2026. While the conflict has actually impacted belief and rates throughout the quarter, it has actually driven more volume and interest in local possessions.
In spite of ongoing geopolitical stress and security risks throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to show strength, maintaining favorable development momentum in the last few years. While conflicts in the larger region and international economic uncertainty remain a structural constraint, GCC nations have so far limited their effect on domestic economic performance through strong financial positions, policy connection, and sustained investment.
3.2 percent development in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output growth predicted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more positive general conditions.
Building a Resilient Supply Chain Through GCC OutsourcingThe IMF's World Economic Outlook (October 2025) tasks global growth reducing to 3.1 percent in 2026, with innovative economies around 1.5 percent and emerging market and establishing economies just above 4 percent. On that contrast, a 4.44.5 percent GCC growth would position the area materially ahead of the world average and somewhat 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 stay contained and reform momentum holds.
Information from the GCC Statistical Center reveal that non-oil sectors already represent 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 forecasted to grow by around 4.1 percent in 2026, supported by strong labor markets, enhancing credit conditions, and increasing financial investment in innovation and AI-related infrastructure.
Public-sector investment and reform stay central to sustaining this trend. Policy measures targeted at bring in foreign direct investment, easing foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and minimize the area's exposure to oil rate volatility. While hydrocarbons no longer control the growth outlook, oil revenues 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 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 toward more positive overall conditions.
The IMF's World Economic Outlook (October 2025) projects worldwide growth reducing to 3.1 percent in 2026, with innovative 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 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 relatively high-growth pocketprovided that local danger 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 actually continued to increase as governments expand financial investment in services, facilities, and technology. 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, improving credit conditions, and rising financial investment in innovation and AI-related infrastructure.
Seven Steps to Establishing Your Brand in Emerging Saudi CitiesPublic-sector financial investment and reform stay main to sustaining this pattern. Policy procedures targeted at attracting foreign direct investment, easing foreign ownership rules, expanding capital markets, and supporting private-sector involvement continue to underpin non-oil growth and minimize the region's exposure to oil rate volatility. While hydrocarbons no longer control the development outlook, oil revenues are expected to play a supportive function in 2026.
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