Foreign investors, both institutional and retail, were net buyers on GCC stock markets during the second quarter of 2024, with $3.5 billion in net buying compared to $1.5 billion in the first quarter of the same year. According to the GCC Trading Activity Quarterly Report – Q2-2024 by Kamco Invest, the trend has been positive since the beginning of the year, with consecutive buying by foreign investors. Saudi Arabia saw the biggest buying with $3.5 billion in net buying, followed by the UAE with $766.6 million in net buying during Q2-2024. However, Qatar saw the biggest selling activity by foreign investors, with net sales of $430.7 million during the quarter.
Kuwait followed with net sales of $296 million, while Oman and Dubai exchanges saw net sales of $44.9 million and $25.4 million, respectively. Bahrain, on the other hand, showed net buying activity at $43.3 million, the highest level in 20 quarters during Q2-2024. The monthly trends showed that Saudi Arabia and the UAE experienced net sell trades by foreign investors in April-2024, followed by net buy trades in the following months, while Qatar, Kuwait, and Oman exchanges saw net sales by foreign investors during the quarter.
The flow of foreign money in the region was influenced by various factors such as regional market trends, IPOs, geopolitical issues, economic health of individual countries, and crude oil prices. The equity market in the region showed a mixed trend, with four out of seven exchanges reporting declines during Q2-2024. Expectations related to global interest rate changes also influenced market performance. Despite a decline in the market during Q2-2024 due to seasonal selling pressure during the Eid Holidays, foreign investors emerged as net buyers, with local investors turning into net sellers.
In terms of month-on-month performance, foreign investors’ net buying value peaked in June-2024 at $3.2 billion, while May witnessed a decline with net buying at $596.5 million and April registered net selling at $332.3 million. Historical trends for trading by foreigners in GCC listed stocks showed declines in only two quarters over the last five years. Foreign investors bought the most stocks in Q1-2022 with net buy transactions of $11.0 billion, mainly in Saudi Arabia and Qatar.
GCC investors, excluding Bahrain due to data unavailability, showed net buying on GCC exchanges during Q2-2024. Net buy trades reached $709.0 million compared to a net sale trade of $414.6 million in Q1-2024. Saudi Exchange witnessed the highest net buying by GCC investors at $887.5 million, followed by UAE exchanges at $285.8 million. Kuwait, Qatar, and Oman exchanges recorded net sales by GCC investors, partially offsetting the overall buying. The total GCC volume traded declined by 14 percent quarter-on-quarter to reach 69.3 billion shares in Q2-2024, compared to 80.6 billion shares in Q1-2024, with all GCC exchanges reporting a decline in volume except Dubai and Bahrain. Dubai saw a 4.1 percent increase in traded volume, while Bahrain recorded a 171.6 percent increase in Q2-2024.
