Foreign investors buy $4.2bn GCC stocks in Q2, up 50%: Kamco Invest

Arab News

15-07-2025

RIYADH: Foreign investors sharply increased their exposure to Gulf stock markets in the second quarter of 2025, with net inflows surging 50 percent compared to the previous three months to reach $4.2 billion.
According to the latest analysis done by Kamco Invest, a Kuwait-based non-banking firm, this momentum extended the streak of net foreign inflows into Gulf Cooperation Council equities to six consecutive quarters, with total net purchases in the first half of 2025 rising 39.8 percent year on year to $7 billion.
The surge comes as GCC equity markets continue to attract global capital, buoyed by strong corporate earnings and ongoing economic reforms. In the first quarter alone, 11 initial public offerings raised $1.6 billion — up 33 percent from a year earlier — driven largely by Saudi Arabia, which accounted for 69 percent of total proceeds, according to a PwC Middle East analysis published in May.
In its GCC Trading Activity Quarterly Report, Kamco said: 'Foreign investors, including institutional and retail investors, were net buyers on GCC stock markets during Q2 2025 with net buying at $4.2 billion as compared to $2.8 billion in net buying during Q1 2025.'
Saudi Arabia led the region with $1.4 billion in net foreign buying, a major jump from $252.3 million in the previous quarter, highlighting growing investor confidence in the Kingdom's market liberalization efforts.
The increased appetite of foreign buyers in the Saudi exchange underscores the progress of the country's economic diversification efforts, as the Kingdom continues to strengthen its capital market and reduce its reliance on crude revenues.
In May, Saudi Arabia's Capital Market Authority revealed in its annual report that net foreign investments in the Kingdom's stock market rose to SR218 billion ($58.1 billion) in 2024, marking a 10.1 percent increase compared to the previous year.
The Kamco report noted that the UAE saw $1.33 billion in net inflows into the Abu Dhabi Securities Exchange in the second quarter, while Kuwait saw $696.5 million, Dubai $462 million, and Qatar $333.6 million.
In contrast, Oman and Bahrain recorded net foreign outflows of $29.6 million and $27.9 million, respectively.
'The 1H 2025 data of trading activity on GCC exchanges indicated that net buying at the aggregate level, although the trend differed at the country level due to net sales during Q1 2025 for some of the exchanges,' said Kamco Invest.
In terms of first-half performance, the UAE attracted the highest foreign inflows at $4.6 billion, followed by Saudi Arabia with $1.6 billion and Kuwait at $1.4 billion.
In a landmark regulatory shift, Saudi Arabia's Capital Market Authority recently announced that citizens and residents of GCC countries will be allowed to invest directly in Tadawul, the Kingdom's main stock exchange.
This move is part of a broader effort to modernize Saudi Arabia's capital markets and enhance foreign investor participation. It aligns with the Kingdom's ambitious Vision 2030 strategy, which aims to diversify the economy, boost market liquidity, and strengthen its financial standing in the Gulf region.
In its latest report, Kamco noted that exchanges in Kuwait, Abu Dhabi, and Qatar witnessed consistent foreign buying throughout the three months of the second quarter.
In contrast, Saudi Arabia saw net foreign selling in April, followed by net buying in the subsequent two months.
Oman was the only exchange in the GCC region to record net foreign selling in each of the three months of the quarter.
'Some of the key factors that affected the flow of foreign money in the region included regional market trends, initial public offerings, geopolitical issues, economic health of the individual countries and crude oil prices,' added Kamco.
Market performance
GCC equity markets delivered a mixed performance in the second quarter, with five of the seven regional exchanges posting gains, reinforcing a broadly optimistic investor outlook.
Aggregate share trading volume across the region reached 94.73 billion shares in the quarter, up 9.1 percent from the first quarter. Qatar led the increase with 12.5 billion shares traded — up 39.4 percent — followed by Dubai with 16.3 billion shares, a 21 percent increase.
In contrast, trading volumes in Saudi Arabia and Bahrain declined by 5 percent and 61.5 percent, respectively, during the same period.
The total value of shares traded in the second quarter reached $151.8 billion, representing a marginal decline of 3.75 percent compared to the first quarter.
Saudi Arabia, Kuwait, and Bahrain recorded declines in trading value, while the rest of the GCC markets saw gains during the period.
The analysis revealed that Abu Dhabi posted the largest increase in value traded, reaching $22.5 billion in the second quarter, up from $20.3 billion in the first three months of the year.
Trading activity on Saudi Arabia's stock exchange stood at $89 billion in the second quarter, down from $95.7 billion in the previous quarter.
Top 10 GCC stocks
The Kamco analysis showed that six Saudi listed stocks ranked among the top 10 most traded GCC equities by trading value in the second quarter of 2025.
The combined trading value of the top 10 stocks across the region reached $34.7 billion, accounting for 36.6 percent of the total value traded during the quarter.
Al-Rajhi Bank led the list with $5.8 billion in trading value, followed by energy giant Saudi Aramco at $5.1 billion, International Holdings Co. at $4 billion, ADNOC Gas at $3.4 billion, and stc at $3.1 billion.
Saudi National Bank saw trading activity of $3 billion, followed by Emaar Properties at $2.9 billion and Alinma Bank at $2.8 billion.
Kuwait Finance House recorded $2.5 billion in trades, while Umm Al Qura for Development and Construction Co., also known as Masar, saw $2.1 billion.