By Mohanad Yakout, Senior Markets Analyst, Scope Markets
2025 proved a year of contrasts for MENA equity markets. In the UAE, the Dubai Financial Market (DFM) and Abu Dhabi Securities Exchange (ADX) steadily outperformed many regional peers, as investors gravitated toward more diversified economies less sensitive to oil-price swings. DFMMI (Dubai’s main index) registered a strong run mid-year.
By contrast, the Tadawul All Share Index (TASI) in Saudi Arabia struggled, the region’s worst-performing major index in 2025, with a ~12% drop. At the same time, EGX 30 in Egypt delivered impressive gains: the index rose over 30% year-on-year, reflecting renewed investor confidence.
Underlying this among markets was a challenging global environment: oil prices dropped roughly 15 % year-to-date, exerting pressure on oil-dependent economies across the Gulf. That decline weighed on fiscal revenues and investor sentiment, particularly for energy-heavy markets.
Against that backdrop, Dubai (and to some extent Abu Dhabi) emerged as financial safe havens. With a diversified economic base, lower oil breakeven point, robust real estate and services sectors, and strong earnings across non-oil corporates, the UAE began to cement its status as a global financial hub. Analysts have highlighted growing flows into UAE equities as investors rotate away from oil-centric listings toward more stable, diversified equities.
Meanwhile in Saudi Arabia, 2025 saw a strategic turn: under renewed Western engagement, Riyadh via some of its sovereign-backed entities, accelerated investments in artificial intelligence, digital infrastructure and high-tech. The shift away from pure oil and real estate based growth reflects a longer-term push to diversify and future-proof the economy.
In Egypt, the story was of gradual stabilization. After years of economic strain, real GDP grew about an average of 5% QoQ in the first 3 quarters of the year 2025, thanks to structural reforms, manufacturing expansion, and supportive investments.
Inflation, which had surged to historic highs, has moderated significantly. Urban consumer inflation eased to manageable levels, bringing some relief to households, while non-oil private-sector activity reached a five-year high in late 2025.
Together, these developments reflect a broader rebalancing across MENA: markets increasingly favor diversified growth, non-oil investments, and structural reform. As 2025 closes, it seems the region is recalibrating — with Dubai and Abu Dhabi rising as financial safe-havens, Riyadh betting on AI for the next era, and Cairo cautiously emerging from economic turbulence.
