ABU DHABI, 20 Oct. - (ANA) - Net foreign outflows from Middle East and North Africa (MENA) equities jumped to $2.8 billion in 3Q 2026, up from $500 million in 2Q, according to Mashreq Capital’s 4Q 2026 MENA Fixed Income and Equity Markets Outlook (pdf). The asset manager cut its full-year regional equity return forecast to 5-7% from 6-8%, favoring the UAE and Oman while remaining cautious on Qatar and Kuwait.

 

Saudi Arabia took the biggest hit: Foreign investors withdrew $1.5 billion from Saudi equities in 3Q, reversing $1.6 billion of inflows in 2Q and accounting for more than half of regional outflows. Kuwait lost $700 million and Dubai $500 million, while Abu Dhabi and Qatar were broadly flat. The selling intensified in September as geopolitical risks mounted.

 

Saudi’s September sell-off was already flashing warning signs. TASI fell 6.2% m-o-m to its lowest month-end close of 2026, while foreign investors sold a net SAR 4.33 billion, as we reported last week. Higher interest rates and geopolitical uncertainty weighed on valuations, although market watchers described the pullback as a risk-off phase rather than a structural deterioration.

 

Oman’s geography is proving an advantage. The sultanate has kept crude flowing through ports outside the Strait of Hormuz, allowing it to benefit from higher oil prices and an Omani crude premium over Brent. Mashreq remains overweight Oman, where 2Q GDP grew 5.1% and government revenue rose 13% in 1H. FTSE Russell has also placed Oman on its watch list for a possible upgrade from frontier to secondary emerging-market status, with potential implementation after 2027.   - (ANA) -

 

 

AB/ANA/20 October 2026 - - -