Saudi Arabia Economics & Equity Outlook: Buffers Extend the Cycle

Research evidence excerpt

Saudi Arabia Economics & Equity Outlook: Buffers Extend the Cycle

Foundation

June 9, 2026 04:00 AM GMT

Morgan Stanley & Co. International plc+MSaudi Arabia Economics & Equity Outlook | EEMEA Yomna Moheieldin

Economist

Buffers Extend the Cycle Yomna.Moheieldin@morganstanley.comMatthew Nguyen +44 20 7677-0771

Equity Strategist

Matthew.Nguyen@morganstanley.com +44 20 7677-0773

We expect growth to remain supported by higher fiscal revenue Ricardo Rezende, CFA

and domestic demand, despite the oil quantity shock. In Equity, EquityRicardo.Rezende@morganstanley.comAnalyst +44 20 7677-9886

we remain OW Saudi Arabia, but see opportunities becoming Morgan Stanley & Co. International plc (DIFC Branch)+

more selective, with Banks, Energy and Industrials better Shabbir Malik

Equity Analyst

positioned to benefit from the current macro backdrop. Shabbir.Malik@morganstanley.com +971 4 709-7057

Economics | Growth Holds Ground: We revise down our growth forecast to reflect Morgan Stanley & Co. International plc (ADGM Branch)+

Rashad Kawan

the contraction in real oil activity extending into 3Q26, but continue to expect

growth to remain in positive territory. Lower oil export volumes and trade Rashad.Kawan@morganstanley.com +971 2 596-3603

disruptions weigh on real growth, but higher oil prices support oil revenues and Morgan Stanley India Company Private Limited+

government spending. This fiscal support, alongside resilient private consumption, Priyan Mody

should cushion the drag before growth rebounds more strongly in 2027 as the Economist

Priyan.Mody@morganstanley.com +91 22 6996-1855

recovery in oil exports lifts headline growth.

Morgan Stanley & Co. International plc (DIFC Branch)+

Equity Strategy | The Cycle Has Further to Run: We remain OW Saudi Arabia Rajeev Sibal