The UAE has recorded no initial public offering listings in 2026 so far, as uncertainty over the Iran conflict weighs on regional markets. The US-Israeli bombing of Iran and Tehran’s retaliatory strikes on Arab neighbours have halted under a fragile ceasefire.
Dan Simkowitz, co-president of Morgan Stanley, said the UAE could see an IPO rebound if the conflicts end or stabilise. Companies in the UAE raised $1.1 billion through three IPOs in 2025, according to Dealogic data.
Markets wait on the conflict
“I think long term, as the conflicts get resolved or hit some level of stabilisation, you will definitely see a rebound in the IPO marketplace in the UAE,” Simkowitz told The National. He said Morgan Stanley was investing in the region and had “high confidence” in its financial infrastructure.
The Iran war began on February 28 and increased uncertainty across the Middle East. The US-Israeli bombing of Iran and Tehran’s retaliatory strikes on its Arab neighbours halted in early April, but peace in the region rested on a fragile ceasefire, the article said.
A World Bank report released the previous week forecast that Gulf economies would contract by an average of 4.3 per cent in 2026. That marked a downward revision of 5.7 percentage points from its April forecast. The International Monetary Fund also expected the Gulf economy to contract this year, followed by a strong recovery next year if shipping normalised, its managing director, Kristalina Georgieva, said.
Simkowitz said the war “clearly creates a slightly higher and hopefully temporary risk premium in the region”, but added that it hadn’t changed long-term investor interest. Morgan Stanley’s commitment to the region, he said, was “as strong as it's ever been”.
Banking plans and credit growth
Morgan Stanley, headquartered in the US with more than $10 trillion in assets, has operated in the region for the past 20 years. It opened an office in Abu Dhabi in 2024, employs well over 100 people in the region and plans to expand its operations.
“We're going to stay very committed to growing that. I think wealth and asset management will be a part of that,” Simkowitz said. Corporate and foreign direct investment clients, he said, remained focused on regional demographics, potential GDP growth and market diversification. He also said the region had built resilience and had the capital strength to rebuild or redirect energy infrastructure, with international capital available to help.
The bank’s regional deal pipeline remained active, Simkowitz said. Some deals were paused, and companies might need to reassess supply-chain resilience and diversification, but “most of it that was on is underway,” he said.
Simkowitz also expected credit markets to grow in the UAE and across the region. These markets include bonds, government debt, private credit and bank loans. Gulf debt capital markets had $1.2 trillion outstanding at the end of the first half of 2026, according to Fitch Ratings. More than $100 billion had been raised in regional debt markets that year, he said.
Investment amid economic uncertainty
Simkowitz said debt markets were needed alongside equity to support growth, diversification and resilience. He called the expansion of fixed-income and bond markets “incredibly important” and said discussions with Gulf finance ministries, stock exchanges and other leaders had increasingly focused on credit markets. He described the development as a “natural progression” after the success of ADX (Abu Dhabi Securities Exchange) and other Gulf exchanges in equities.
He identified AI as a major economic theme, saying it would require substantial capital before generating future productivity. Relative to GDP, wealth or market capitalisation, he described the UAE as one of the world’s most important AI players. A recent Bain report said the AI industry would need to earn $6 trillion in annual revenue by 2031 to justify capital deployed for data centres. Revenue from new product development was projected to become the industry’s largest contributor, estimated at about $4.2 trillion within the next half-decade.
S&P Global Ratings said economic tailwinds from AI investment and “surprisingly enduring demand” had bolstered credit conditions in many major economies in 2026. The agency warned that positive momentum in overall credit stability would become harder to sustain, citing a sharp rise in benchmark borrowing costs, including government debt yields.
Asked about the outlook for 2027, Simkowitz said: “I think intense and don't be complacent. No one can be complacent. It may not be as dramatic [as this year], but it's going to be intense.”