The Abu Dhabi Stock Exchange (ADX) recorded the highest level of foreign investor purchases among Gulf Cooperation Council (GCC) stock markets in the first quarter, according to a recent report.
As per Kamco Invest data, international investors acquired $2.3 billion in shares on ADX, followed by Boursa Kuwait, where purchases totaled $705.6 million. The Dubai Financial Market ranked third, with foreign investors buying $343 million worth of shares.
Overall, foreign investors, which include both institutional and retail participants, were net buyers across GCC stock markets in Q1-2025, with volume reaching $2.8 billion, compared to $3.0 billion in net purchases in Q4-2024. “The initial period of the year displayed a positive trend with consistent buying in the first two months, followed by net selling in March 2025,” the report, authored by Junaid Ansari, Head of Investment Strategy & Research, and analyst Vineetha K. Yeluri, highlighted.
Following the top three markets, the Saudi and Bahrain exchanges reported net purchases of $252.3 million and $23.2 million respectively. In contrast, Qatar and Oman experienced net selling with figures of $421.0 million and $459.2 million for Q1-2025.
On a monthly basis, Boursa Kuwait observed continuous foreign buying throughout the quarter. In contrast, Saudi Arabia and the UAE experienced net buying in the first two months but followed it up with net selling in March 2025. Recently, the Saudi Capital Market Authority (CMA) announced that foreigners are now permitted to invest in publicly listed companies in Saudi Arabia that own properties in the holy cities of Makkah and Madinah. “This initiative aims at attracting foreign investments and ensuring liquidity for both current and forthcoming projects,” noted the report. Qatar similarly saw net buying from foreign investors in January 2025, which was followed by net selling during the subsequent two months.
Conversely, the Oman exchange faced net selling during this quarter. “The Muscat Stock Exchange has introduced new investment strategies involving partnerships with other market platforms to enhance liquidity and encourage local and international investments,” the report stated.
Key factors influencing the influx of foreign capital in the region include market conditions, initial public offerings (IPOs), geopolitical events, the economic status of individual nations, and fluctuations in crude oil prices. The quarterly performance of equity markets leaned towards downturns, with six out of seven exchanges reporting declines in Q1-2025. Investor sentiment was affected by uncertainties surrounding US trade policies and predicted slowdowns in the US economy.
Recent US government announcements regarding tariffs on imports, along with retaliatory actions from trading partners, disrupted investor confidence in global economic growth. “Seasonal selling pressures during the Eid Holidays contributed to market declines, leading local investors to sell off shares that were subsequently purchased by foreign investors, resulting in a broad-based net buy,” the report further explained.
In terms of month-over-month performance, foreign investor net buying reached its peak in February 2025 at $2.4 billion. January saw a net buying value of $833.8 million, while March experienced a downturn with net selling reaching $518.4 million. “Historically, foreign trading activity in GCC-listed stocks recorded declines in only one quarter over the past five years. The highest purchases were noted in Q1-2022, amounting to $11.0 billion in net buying transactions, largely driven by significant buying in Saudi Arabia and Qatar,” the report stated.
Within the Saudi market, local investors were net sellers in Q1-2025, with total sales amounting to SAR 945.6 million compared to SAR 4.2 billion in net selling from Q4-2024. However, Saudi institutions were net purchasers of Saudi stocks, totaling SAR 102.8 million, which was overshadowed by retail investor sell trades amounting to SAR 1.0 billion. Notably, non-GCC foreign investors were active buyers, acquiring SAR 2.4 billion in net buy trades this quarter, which was slightly offset by net selling by GCC investors totaling SAR 1.5 billion.
Trading activity among GCC investors (excluding Bahrain due to unavailable data) indicated net selling during Q1-2025, totaling $482.3 million, a slight decrease from $505.3 million in net sells in Q4-2024. Boursa Kuwait recorded the highest net buying by GCC investors in Q1-2025, amounting to $56.9 million, followed by Dubai at $12.4 million. Conversely, exchanges in Saudi Arabia, Abu Dhabi, Qatar, and Oman saw net selling from GCC investors, which partially countered the overall buying by this group.