Stocks opened the new year on a positive note with artificial intelligence and technology companies dominating market sentiment. Precious metals also advanced.
The market direction this year will be shaped by AI, the change of guard at the Federal Reserve and potential market turbulence under US President Donald Trump, according to experts.
“Stocks have entered 2026 on a positive footing, buoyed by themes that defined much of last year’s rally,” said Tony Hallside, chief executive of Dubai-based advisers STP Partners. He added that strong momentum around AI and the semiconductor sector continues to support gains, alongside renewed investor interest in precious metals.
Bitcoin could move back towards its highs next year, thanks to easier financial conditions, a weaker US dollar and persistent exchange-traded fund inflows, market experts say.
One important factor in the short term is US dollar liquidity and the outlook for US interest rates, says Carsten Menke, head of next-generation research at Swiss private bank Julius Baer.
M&A activity across MENA has surged in 2025, with deal volumes accelerating sharply as sovereign capital, policy reform, and global investor interest converge. What’s encouraging is that this momentum isn’t driven by opportunistic trades alone, but by structurally stronger balance sheets, clearer regulation, and a more mature regional deal ecosystem.
Looking ahead to 2026, the key question is sustainability. If liquidity conditions remain supportive and execution discipline holds, MENA could shift from being a cyclical M&A market to a consistently strategic one. The foundations are in place — capital, confidence, and capability — now it’s about converting momentum into long-term value.
We are delighted to welcome STP Partners Limited as the first London Stock Exchange member firm from Dubai (DIFC).
The London Stock Exchange offers a range of international access points for membership, including Dubai (DIFC), Hong Kong, and Singapore.
Tony H., David Briody
Small-caps have faced headwinds in recent years as investors concentrated on large-cap and mega-cap names. But with valuations now lower and growth potential intact, they may represent an important opportunity for long-term, disciplined investors.
What matters most is timing and structure. Small-caps tend to outperform when confidence is high and financing conditions are supportive. With rate cuts expected on the horizon and regional markets continuing to mature, selective exposure to high-quality small-caps could reward patient investors.
At STP Partners, we see this as an encouraging sign of markets in transition — with clear momentum toward broader participation. Continued digitisation, thoughtful allocation policies, and easing access for individuals (including non-residents) will help strengthen depth and resilience over the long term.
