Foreign Investors Are Buyers on GCC Bourses in Q1-25

Foreign investors, including institutional and retail investors, were net buyers on the GCC stock markets during Q1 of 2025 with net buying at $2.8 billion compared with $3 billion in net buying during the previous quarter.

According to Kuwait-based Kamco research, the trend was positive at the start of the year with consecutive buying seen in the first two months followed by net selling during the month March this year.

The biggest buying was seen in Abu Dhabi with total net buying of $2.3 billion followed by Boursa Kuwait, which also witnessed consecutive buying by foreigners that reached $705.6 million in Q1-2025.

Dubai was next with net buying of $343 million by foreigners followed by Saudi Arabia and Bahrain exchanges with net buy transactions of $252.3 million and $23.2 million, respectively. However, data for Qatar and Oman showed net selling at $421 million and $459.2 for Q1-2025, Kamco Research said.

Meanwhile, the monthly trend showed Boursa Kuwait witnessed consecutive buying by foreigners during the three months of the quarter. Conversely, Saudi Arabia and the UAE recorded net buying by foreign investors during the initial two months, which were succeeded by net sales in March 2025.

Recently, Saudi Arabia’s Capital Market Authority (CMA) announced that foreigners can invest in Saudi-listed companies that own real estate in Makkah and Madinah. This move is aimed at attracting foreign capital and providing the necessary liquidity for current and future projects in Makkah and Madinah.

Similarly, Qatar witnessed net buy trades by foreign investors during in January Jan-2025 followed by net sell trades during the remaining two months. On the other hand, Oman exchange witnessed net sales by foreign investors during the quarter.

The Muscat Stock Exchange has announced new investment initiatives that involve collaboration with other market exchange platforms, aimed at enhancing liquidity sources across various markets to encourage increased local and international investments.

Some of the key factors that affected the flow of foreign money in the region included regional market trends, IPOs, geopolitical issues, economic health of the individual countries and crude oil prices.

The quarterly trend in the equity market was skewed towards decliners as six out of seven exchanges reported declines during the first quarter. The uncertainty related to US trade policies and a forecasted slowdown in the US economy affected investor sentiments in the region.

Impact of US Tariffs

The US government’s consecutive announcements related to imposition of tariffs on US imports and the counter measures from its trading partners affected investor confidence in global economic growth.

The seasonal selling pressure during the Eid Holidays also resulted in a decline in the market. As a result, local investors were net sellers during the quarter and these shares were grabbed by foreign investors resulting in a broad-based net buy trades by the latter.

In terms of m-o-m performance, net buying value by foreign investors peaked during February with aggregate monthly net buying at $2.4 billion. January registered net buying at $833.8 million, while March witnessed a decline with net selling at $518.4 million.

Historical trend for trading by foreigners in GCC listed stocks showed declines merely in one quarter over the last five years.

It may be recalled that foreigners bought the most stocks during Q1 of 2022 with net buy deals of $11 billion, reflecting steep increase in buying mainly in Saudi Arabia and Qatar.