GCC business may follow global downward trend

GCC business may follow global downward trend

Gulf Cooperation Council companies are feeling the effects of the global economic slowdown, according to Iridium Advisors’ AI-powered report released today. 

The Dubai-based consultancy stated that its GCC Earnings Call Sentiment Index dropped 8% quarter-on-quarter to its lowest point since Q1 2021. 

“This is the first quarter in over a year that we have seen a marked decline in management sentiment,” said Oliver Schutzmann, the company’s CEO, about GCC company feelings towards earnings in Q3 2022. 

“While equity markets in the region have performed better than those in the US and Europe, we can’t discount the fact that regional equity markets are not immune to larger global market contractions,” he added, listing rising interest rates, inflationary pressures, oil price volatility and fears of recession as core causes. 

The UAE and Kuwait were the only two countries that showed a slight increase in sentiment. The strongest negative trends were seen in Oman and Bahrain, and to a lesser extent, Saudi Arabia. 

Real estate was the only sector where management teams showed a slight increase in sentiment.  Communication services and materials that include chemicals, construction materials and more, saw the largest decline.

AI accuracy?

The calculated index uses natural language processing technology called sentiment analysis, which incorporates AI to measure