GCC equities suffer $600m foreign investor outflows

Almost $600 million of foreign investors’ capital flowed out of GCC equities markets in April 2024.

According to data from Iridium Advisors, there was a total of $596.7 million in outflows.

The majority came from Saudi Arabia ($409 million), followed by Kuwait ($97 million), UAE ($48.6 million) and Qatar ($34.9 million).

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According to Iridium, these shifts are indicative of broader market responses to the danger of escalating tensions in the Middle East and the challenging global economic climate, particularly the impact of higher for longer interest rates.

“Over the past year, GCC equity markets have shown significant volatility in foreign capital flows,” stated the Iridium report.

“After observing major inflows in mid-2023, the markets encountered steep outflows in subsequent months, especially in October (Hamas attacks Israel) and December 2023 (Israel pushes into Gaza), and again in April 2024 (ceasefire talks fail).

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“These movements underscore the effects of geopolitical instability, impacting investor confidence and market stability.”

April’s outflows also aligned with a decline in the MSCI GCC Index, highlighting the GCC market’s sensitivity to shifts in foreign investment flows, stated the report.

“The performance across individual country indices further supports the correlation between investment dynamics and market performance.”

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