GCC Equity Trading Patterns for 2026

Residential or commercial property costs have come under pressure after a period of strong development, with recent data from the Dubai Land Department revealing a drop in home mortgage deals and money sales. We believe the threat of a lasting migrant outflow and a severe downturn in the real estate sector is low.

As a long lasting US-Iran deal takes shape, the fallout from the dispute has actually tightened up regional monetary conditions, exposing vulnerabilities through capital outflows, wider bond spreads, and weaker investor belief. Most GCC sovereigns bring fairly little debt and financing dangers are therefore limited in the UAE, the reserve bank's liquidity management has reduced immediate issues.

That said, Bahrain has had the ability to depend on support from neighbours, consisting of Saudi Arabia and the UAE, and it effectively raised $1bn from an oversubscribed sovereign bond sale this month, marking the first offering from the region considering that the war began. High-frequency fiscal data underscore the strain on local public financial resources from the conflict.

ANSR July GCC PRs 50DR+

Navigating Wealth Strategies for a Global Economy

In Saudi Arabia, the deficit spending more than doubled to SAR125.7 bn, or about 9% of GDP in Q1, driven by a decline in oil earnings and a surge in spending, especially on subsidies, reflecting contingency investments connected to the regional environment and a velocity of Vision 2030 spending. In Qatar, the crisis brought oil and gas earnings to a stop, swelling the deficit spending to the largest considering that 2017.

GCC inflation dynamics remain uneven, with food prices the main source of upward pressure and inflation in this classification fortifying in Kuwait, Oman and Qatar. By contrast, food inflation remains fairly suppressed in Saudi Arabia, most likely reflecting the mitigating effect of its bigger domestic food production base and higher supply-chain resilience.

We continue to view cost pressures as mainly temporal instead of indicative of a continual inflationary cycle. Appropriately, we expect average inflation to ease to 2.1% y/y in 2027 as short-term supply-side pressures dissipate. With near-term inflation elevated and transit through the Strait most likely set to resume slowly, we expect the US Federal Reserve to keep rate of interest on hold up until December, and local rate policies to do the same.

We anticipate Iran's GDP to diminish by 10.8% this year (we forecast a 9.4% contraction 3 months ago). Oil production and exports, which offer vital income and FX inflows, have actually been cut by the United States marine blockade, while non-oil activity has actually been seriously struck. In Iraq, oil exports have collapsed to a trickle and we're anticipating 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 global economy after more than a decade of civil war. We prepare for GDP growth to typical 9.6% over 2026-2027, supported by restored financial investment, especially in banking and energy, financial reforms, and the progressive reopening of regional trade links.

Future GCC Market Projections

The World Bank has slashed its 2026 growth projection for Middle East economies, stating overall GDP development in the region is expected to slow from an estimated 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 financial volatility, and weakened 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 Poverty Outlook anticipates that the area's aggregate (omitting the Iran) GDP growth will slow down to 1.8 percent in 2026, down from 4.0 percent estimated for 2025. The 2026 forecast has actually been devalued by 2.4 portion points since the January forecasts, showing the negative results of the ongoing dispute.

Saudi Arabia: Projection was devalued by 1.2 portion points given that January. Growth is now anticipated to slow from 4.3% in 2025 to 3.1% in 2026, keeping in mind that Saudi Arabia's outlook remains the greatest amongst Gulf economies. United Arab Emirates: Development forecast for the UAE has actually fallen by 2.7 percentage points since January.

Qatar: Significantly, growth forecast for the Qatari economy has actually seen a sharp decrease of 11.0 portion points given that January. The economy is now expected to tape-record a contraction of 5.7%, down from an estimated growth of 5.3%, due to serious obstruction to liquefied gas materials. Qatar is a crucial gamer in the global energy market, with a worldwide market share of liquefied gas (LNG) materials varying between 20% and 21%.

Kuwait relies entirely (100%) on the Strait of Hormuz to export its petroleum and derivatives. As a result, closing the strait would mean a complete shutdown of the nation's financial lifeline, instantly stopping earnings inflows to the state budget. Bahrain: Development projection for Bahrain's economy has actually decreased by 1.8 percentage points given that January.