In August 2024, cumulative net foreign inflows into GCC markets crossed the $50 billion mark for the first time, underscoring the region’s growing appeal to global investors. Over the past 12 months, the GCC region attracted a cumulative $4.7 billion in net foreign inflows with Saudi Arabia leading at $4 billion, followed by the UAE at $2 billion.
Growing investor confidence drives growth
In August, GCC equity markets saw strong net foreign inflows of $892 million, also driven primarily by Saudi Arabia and the UAE. The Kingdom saw a significant rebound, posting a $612 million net inflow after experiencing a $310 million outflow in July. Meanwhile, the UAE brought in $270 million in inflows, slightly down from July’s $372 million.
In addition, Kuwait added $67 million in positive flows while Qatar continued its negative pattern, registering a net outflow of $56 million.
The strong performance in August comes despite global volatility, with emerging markets experiencing net outflows, reinforcing the GCC’s growing attractiveness to foreign investors. Iridium‘s monthly analysis reveals that positive sentiment likely played a key role in these movements as corporates witnessed a new peak in earnings call sentiment, reflecting strong financial performance and growing analyst and investor confidence.
August 2024’s net inflow of $892 million marked a significant annual improvement from $128 million in August 2023, signaling greater investor confidence in the region.
Read | National banks in the UAE invest $1.19 billion in local stock markets in 12 months: CBUAE
Saudi Arabia’s recovery boosts regional market
Saudi Arabia’s recovery from volatility earlier this year, including a $597 million outflow in April, significantly supported growth, underscoring its importance as a driver of capital flows in GCC markets.
On the other hand, Oman witnessed consistent challenges, with net outflows totaling $938 million in 11 out of the last 12 months. Similarly, Qatar also struggled, experiencing outflows in 7 of the last 12 months, leaving it with a negative balance of $431 million.
This data reinforces Saudi Arabia’s position as the main driver of foreign capital flows in GCC markets, with the UAE also showing growing strength. Qatar and Oman, however, continue to face challenges, consistently lagging in their ability to attract and retain foreign investments.
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