Most stock markets in the Gulf ended higher on Tuesday as investors looked ahead ‍to the Federal Reserve's ‍policy outlook and a widely anticipated U.S. interest rate cut later this week. Recent ​data showed that the U.S. Personal Consumption Expenditures Price Index, the Fed's preferred inflation measure, met expectations, ⁠while consumer sentiment improved in December.

In November, private payrolls saw their steepest decline in more than two-and-a-half ⁠years, but ‌jobless claims for the week ended November 28 fell to their lowest in three years. According to CME's FedWatch Tool, markets are now pricing in an ⁠89% chance of a quarter-point rate cut at the Fed's December 9–10 meeting.

The Fed's stance holds implications for Gulf economies, where most currencies are pegged to the U.S. dollar, making it an anchor for regional monetary stability. Saudi Arabia's benchmark index gained 0.7%, led ⁠by a 2.1% rise in Al Rajhi ​Bank and a 1.4% increase in Alinma Bank .

Elsewhere, Consolidated Grunenfelder Saady Holding Co closed 0.8% higher in its market ‍debut. Investor sentiment is being largely underpinned by expectations of a potential rate cut at tomorrow's Fed meeting.

The market outlook ​is further strengthened by solid fundamentals and ongoing expansion in the non-oil sector, said George Pavel, general manager at Naga.com. "However, the market could remain exposed to the downside if oil markets continue to slide," he said.

Oil prices - a catalyst for the Gulf's financial markets - steadied after falling 2% in the previous session, with investors keeping a close eye on peace talks to end Russia's war in Ukraine, concerns over ample supply, and the looming U.S. rate decision.

Dubai's main share index rose 0.8%, with blue-chip developer Emaar Properties closing 1.4% higher. In Abu Dhabi, the index added ⁠0.5%. The Qatari benchmark was up 0.4%, with Qatar ‌National Bank, the Gulf's biggest lender by assets, rising 1.1%.

Outside the Gulf, Egypt's blue-chip index eased 0.1%, snapping a four-day winning streak.

Saudi Arabia gained 0.7% to 10,700

Abu Dhabi rose 0.5% to 9,989

Dubai advanced 0.8% ‌to 6,045

Qatar added 0.4% ⁠to 10,777

Egypt eased 0.1% to 41,941

Bahrain was up 0.2% to 2,050

Oman climbed 1.2% to 5,961

Kuwait rose 0.7% to 9,645

(Reporting ⁠by Ateeq Shariff in Bengaluru; Editing by Eileen Soreng and Jan Harvey)