Gulf stock exchanges' market capitalization reaches $3.96 trillion by end of July
A report by the Investment Research Unit at Kuwait Investment Company recorded a relative easing of geopolitical tensions in July compared to previous periods, which contributed to improved investor sentiment, although regional risks remained a factor influencing liquidity flows and market trends. Gulf stock markets showed mixed performance during the month, with the financial results of listed companies being the primary driver of the Gulf bourses, particularly in the banking, telecommunications, and energy sectors. The Saudi banking sector recorded an 8% growth in net profits for the first half of the year.
Banks in Abu Dhabi recorded a 12% growth in their combined net profits, reaching 25.2 billion dirhams, while banks in the Dubai Financial Market also saw a 4% growth in net profits, totaling 22.31 billion dirhams.
Despite challenges, Gulf markets demonstrated resilience, supported by the strong position of banks, increased government spending, and improved profits for a large number of leading companies.
The report noted that the Muscat Stock Exchange led Gulf markets by a wide margin in terms of returns, posting gains of 24%, supported by good corporate financial results, rising investor confidence in market reforms, and expectations of an upgrade. The Saudi stock market was the only other market to close the first seven months of the year with moderate gains of 0.9%, benefiting from the strong financial results of banks and energy and telecommunications companies.
The total market capitalization of Gulf stock markets declined by approximately $2 billion in July 2026, ending the month at around $3.96 trillion. Total liquidity in Gulf bourses during the first seven months of 2026 reached approximately $347 billion, including $187 billion in the Saudi stock market, compared to $84 billion for UAE markets and $37 billion for the Qatar Stock Exchange.
The report covered the Kuwait Stock Exchange, which saw a decline in trading liquidity during the first seven months due to some profit-taking operations. It warned investors about geopolitical developments and rising investment risks, noting that trading volume reached approximately 1.14 billion dinars, down 24% compared to the same period in 2025. By sector, 30.7% of the bourse’s total liquidity flowed into the banking sector, equivalent to 3.5 billion dinars. Trading was concentrated in shares of Kuwait Finance House, National Bank of Kuwait, and Boubyan Bank, with volumes of 1.36 billion, 929 million, and 293 million dinars, respectively. Liquidity for financial services sector companies reached 3.1 billion dinars, and for real estate companies, 1.9 billion dinars, accounting for 27% and 16.6% of trading value in the Kuwait Stock Exchange, respectively.
According to market classification, the report stated that trading liquidity was concentrated in First Market shares, accounting for 66.6% of the bourse’s total liquidity, reaching 7.6 billion dinars. The First Market index fell by 2.98%, compared to a 1.69% loss in the General Market index, due to losses recorded by the Banking Sector index of 2.1%. First Market shares remain the main lever for the Kuwait Stock Exchange, with a market capitalization of approximately 44 billion dinars at the end of the month, equivalent to 83% of the bourse’s market value. Meanwhile, trading in the Main Market declined by 42%, with its liquidity accounting for 33.4%, equivalent to 3.81 billion dinars. This decline in speculative activity and liquidity, which served as an indicator of reduced speculation on some mid-cap and small-cap stocks by market value, coincided with good gains in the Main Market index of 5.2%.
The Kuwait Stock Exchange’s market capitalization stood at approximately 53.3 billion dinars at the end of July 2026, up by about 376 million dinars from the end of June 2026, yet still 773 million dinars below the end of 2025. The monthly increase was driven by a 968 million dinar rise in the market capitalization of the banking sector, narrowing its year-to-date losses to 675 million dinars. Meanwhile, the telecommunications sector’s market capitalization declined by 196 million dinars. Market capitalization was distributed across 13 sectors, led by banking with 32.3 billion dinars, accounting for 60.6% of the market. This was followed by financial services, representing 10.54% with a market value of 5.62 billion dinars; real estate, at 7.95% equivalent to 4.24 billion dinars; and telecommunications, at 7.55% equivalent to 4.02 billion dinars. The industrial sector accounted for 4.87% of the market capitalization.
