Abu Dhabi’s stock market emerged as the most attractive destination for foreign investors across the GCC during the first quarter of 2025, registering a remarkable $2.3 billion in net foreign inflows. This strong performance highlights the emirate’s growing appeal in the global investment landscape, outperforming other regional markets by a significant margin.
GCC Sees $2.8 Billion in Net Foreign Buying
Across the Gulf Cooperation Council (GCC) markets, foreign investors remained active buyers, accumulating a total of $2.8 billion in net equity purchases in Q1 2025. Although slightly lower than the $3.0 billion recorded in Q4 2024, the trend indicates sustained investor interest in the region, despite global economic uncertainties.
The start of the year saw consistent buying in January and February, before a shift to net selling emerged in March. This seasonal shift is often attributed to profit-taking ahead of the Eid holidays, alongside broader macroeconomic headwinds.
Abu Dhabi Dominates as Investor Favorite
Abu Dhabi led the pack with $2.3 billion in net buying, accounting for the majority of foreign capital inflows into the region. It was followed by:
- Boursa Kuwait: $705.6 million
- Dubai Financial Market: $343.0 million
- Tadawul (Saudi Arabia): $252.3 million
- Bahrain Bourse: $23.2 million
In contrast, Qatar and Oman saw net outflows, with foreign investors selling off $421.0 million and $459.2 million worth of equities, respectively.
Kuwait Stands Out with Three Straight Months of Gains
Kuwait’s stock market was the only GCC exchange to report consistent foreign investor buying throughout the quarter. This stability underscores investor confidence in its market fundamentals and regulatory developments.
Meanwhile, Saudi Arabia and the UAE saw strong foreign inflows in January and February, followed by net selling in March. This aligns with short-term global market corrections and profit realization during the Ramadan season.
New Saudi Investment Policy Opens Doors to Makkah and Madinah
A notable development came from Saudi Arabia, where the Capital Market Authority announced that foreign investors can now invest in listed companies owning real estate in the holy cities of Makkah and Madinah. This strategic move is expected to channel more foreign capital into large-scale infrastructure and real estate projects in these regions.
Mixed Sentiment in Qatar and Oman
Foreign buying momentum in Qatar faded after January, turning to net selling in February and March. Similarly, Oman witnessed net outflows throughout the quarter, although its exchange is pursuing new liquidity-boosting collaborations with regional platforms to improve its attractiveness to international investors.
Global Factors Impacting GCC Market Dynamics
Investor behavior in Q1 2025 was shaped by a mix of local and global factors. These included:
- IPO activity and economic fundamentals within GCC countries
- Volatile oil prices
- Geopolitical tensions
- U.S. economic outlook and tariffs
According to Kamco Invest, the uncertainty surrounding U.S. trade policy and fears of an economic slowdown led to cautious investor behavior globally, which also spilled over into the GCC.
February Marks the Peak of Foreign Buying
February 2025 saw the highest level of monthly foreign investor activity, with $2.4 billion in net purchases across GCC markets. January recorded $833.8 million in net buying, while March saw a decline, shifting to net selling of $518.4 million.
Saudi Market Activity: Institutions vs. Retail
In Saudi Arabia, local retail investors were net sellers, offloading SAR1.0 billion in equities. In contrast, institutional investors maintained a positive stance, adding SAR102.8 million in net purchases. Notably, non-GCC foreign investors bought SAR2.4 billion worth of Saudi stocks, despite some offsetting sales from GCC investors.
GCC Investors Show Mixed Trends
Overall, GCC-based investors (excluding Bahrain) were net sellers in Q1 2025, with total net selling reaching $482.3 million. However, Boursa Kuwait recorded the highest net buying from GCC investors at $56.9 million, followed by Dubai with $12.4 million. Saudi Arabia, Abu Dhabi, Qatar, and Oman all saw net sales from regional investors.
Top 10 Traded Stocks in GCC by Value
Among the most actively traded stocks in the region:
- Al-Rajhi Bank topped the list with $6.3 billion in trades
- Oula Fuel Marketing Co. followed with $5.2 billion
- Saudi Aramco saw $4.4 billion in trades
Other notable mentions include Adnoc Gas, IHC, Emaar Properties, Ahli Bank Oman, SNB, Nice One, and Alinma Bank. Together, the top 10 stocks accounted for 25% of the total GCC trading volume, reflecting high investor interest in select blue-chip names.
