GCC Equity Trading Trends in 2026

Residential or commercial property prices have come under pressure after a duration of strong growth, with recent data from the Dubai Land Department revealing a drop in mortgage transactions and money sales. Nevertheless, we think the danger of a long lasting migrant outflow and a severe decline in the property sector is low.

As a lasting US-Iran offer takes shape, the fallout from the conflict has tightened up local monetary conditions, exposing vulnerabilities through capital outflows, wider bond spreads, and weaker investor belief. Most GCC sovereigns carry reasonably little debt and funding dangers are for that reason limited in the UAE, the central bank's liquidity management has alleviated instant concerns.

That said, Bahrain has had the ability to count on support from neighbours, consisting of Saudi Arabia and the UAE, and it successfully raised $1bn from an oversubscribed sovereign bond sale this month, marking the first offering from the region given that the war began. High-frequency fiscal information highlight the strain on regional public finances from the conflict.

ANSR July GCC PRs 50DR+

Foreign Investment Opportunities within the GCC

In Saudi Arabia, the deficit spending more than doubled to SAR125.7 bn, or about 9% of GDP in Q1, driven by a decrease in oil income and a surge in costs, particularly on subsidies, reflecting contingency expenses connected to the regional environment and a velocity of Vision 2030 spending. In Qatar, the crisis brought oil and gas revenue to a stop, swelling the budget deficit to the biggest since 2017.

GCC inflation characteristics remain unequal, with food prices the main source of upward pressure and inflation in this classification conditioning in Kuwait, Oman and Qatar. By contrast, food inflation remains reasonably controlled in Saudi Arabia, likely showing the mitigating impact of its larger domestic food production base and higher supply-chain durability.

We continue to see rate pressures as largely transitory rather than a sign of a sustained inflationary cycle. Accordingly, we anticipate average inflation to alleviate to 2.1% y/y in 2027 as momentary supply-side pressures dissipate. With near-term inflation raised and transit through the Strait likely set to resume gradually, we anticipate the United States Federal Reserve to keep rates of interest on hold up until December, and regional rate policies to do the same.

We expect Iran's GDP to diminish by 10.8% this year (we anticipate a 9.4% contraction 3 months ago). Oil production and exports, which offer necessary earnings and FX inflows, have actually been reduced by the US marine blockade, while non-oil activity has actually been seriously hit. In Iraq, oil exports have actually collapsed to a trickle and we're forecasting GDP to contract by around 22% this year, with a sharp 33% rebound in 2027 as oil exports normalise.

By contrast, Syria continues to reintegrate into the worldwide economy after more than a decade of civil war. We expect GDP growth to average 9.6% over 2026-2027, supported by renewed investment, especially in banking and energy, monetary reforms, and the gradual resuming of regional trade links.

Strategic Capital Diversification for 2026

The World Bank has slashed its 2026 growth forecast for Middle East economies, saying general GDP growth in the area is expected to slow from an approximated 3.6% in January to 1.8% for 2026. The closure of the strategic Strait of Hormuz, and destruction of energy and public facilities, had actually disrupted markets, increased monetary volatility, and deteriorated the 2026 growth outlook, the World Bank Group stated in its Economic Update for the Middle East, North Africa, Afghanistan and Pakistan.

The April 2026 World Bank's Macro Hardship Outlook forecasts that the area's aggregate (omitting the Iran) GDP growth will slow down to 1.8 percent in 2026, below 4.0 percent approximated for 2025. The 2026 projection has been devalued by 2.4 portion points considering that the January projections, showing the adverse impacts of the continuous conflict.

Saudi Arabia: Forecast was reduced by 1.2 portion points because January. Growth is now expected to slow from 4.3% in 2025 to 3.1% in 2026, noting that Saudi Arabia's outlook stays the strongest among Gulf economies. United Arab Emirates: Growth projection for the UAE has fallen by 2.7 portion points since January.

Qatar: Especially, development projection for the Qatari economy has actually seen a sharp decline of 11.0 percentage points given that January. The economy is now anticipated to tape-record a contraction of 5.7%, below an approximated growth of 5.3%, due to severe obstruction to liquefied gas products. Qatar is a key player in the worldwide energy market, with an international market share of liquefied gas (LNG) supplies ranging in between 20% and 21%.

Kuwait relies completely (100%) on the Strait of Hormuz to export its petroleum and derivatives. As a result, closing the strait would indicate a complete shutdown of the country's financial lifeline, immediately stopping income inflows to the state spending plan. Bahrain: Development forecast for Bahrain's economy has decreased by 1.8 portion points considering that January.