Friday, 16 October 2026
International investors reduced their holdings in Gulf-listed companies during the third quarter of 2026, contributing to a significant change in regional equity market activity. Research by Kamco Invest shows that foreign investors sold USD 2.3 billion more in shares than they purchased between July and September, while transactions involving listed real estate companies fell sharply compared with the previous year. The figures point to a more cautious investment environment across Gulf financial markets, although the implications for direct property investment remain uncertain.
The third-quarter withdrawal was substantially larger than the USD 298.3 million recorded during the preceding three months. It also represented the highest quarterly net selling figure in Kamco Invest’s records, which extend back to 2019. Across the first nine months of 2026, foreign investors recorded net sales of USD 1.1 billion, reversing the USD 11.7 billion in net purchases registered during the equivalent period of 2025.
Saudi Arabia experienced the largest reduction in foreign investor positions, with net sales reaching approximately USD 1.5 billion during the quarter. Dubai followed with USD 414.3 million, while Kuwait recorded USD 284.1 million. Smaller withdrawals were reported in Abu Dhabi, Oman and Bahrain. Qatar was the only Gulf market to record a positive balance of foreign purchases, amounting to USD 10.9 million.
The decline in international participation coincided with lower trading activity across the region. The combined value of shares exchanged on GCC stock markets fell to USD 135 billion in the third quarter, compared with USD 157.7 billion between April and June. This represented a quarterly reduction of 14.4%, while the number of shares traded decreased by 12.7% to 83.1 billion. Every GCC exchange recorded a contraction in trading volume.
Real estate was particularly affected by the reduction in market transactions. The value of shares traded in listed property companies declined by 17% compared with the third quarter of 2025, the largest percentage decrease among the ten sectors covered in the research. The figures suggest that investors were less active in property-related securities, although they do not establish whether the market values of the underlying businesses increased or decreased.
Major developers nevertheless remained among the region’s most actively traded listed companies. Emaar Properties recorded approximately USD 3.6 billion in share transactions during the quarter, while Aldar Properties accounted for USD 2.1 billion. Their presence among the leading stocks reflects the established position of large property businesses within Gulf capital markets, particularly in the United Arab Emirates.
For commercial real estate investors, the distinction between listed securities and direct property transactions is important. Trading in developer shares reflects activity in financial markets rather than the purchase or sale of buildings. Consequently, a decline in equity trading does not necessarily indicate weaker office leasing, reduced residential sales, falling property valuations or fewer commercial real estate transactions.
However, developments in equity markets can influence the wider investment environment. Publicly traded developers and property investment companies may rely on capital markets to support expansion, acquisitions and development programmes. Changes in investor participation and market liquidity can therefore become relevant when businesses assess financing options, although Kamco Invest’s figures do not demonstrate that individual property companies are experiencing difficulties raising capital.
The latest research also shows that reduced trading was not confined to property-related businesses. Banking remained the largest sector by transaction value, with USD 30.6 billion in shares traded during the quarter, down from USD 34.2 billion a year earlier. Across all sectors, GCC trading value reached USD 448.7 billion during the first nine months of 2026, representing a decline of 6.3% compared with the same period in 2025.
The figures highlight a substantial change in international investor activity across Gulf equity markets following stronger foreign participation in previous years. For the region’s property industry, the next question is whether reduced activity in listed real estate shares will remain a financial market development or eventually influence investment decisions and development funding. Assessing that relationship will require additional evidence from property transactions, company financial results and capital-raising activity.
