Most stock markets in the Gulf tracked global equities higher in early trading on Thursday, after a smaller-than-expected rise in U.S inflation bolstered investors' hopes for interest rate cuts by the Federal Reserve.

Saudi Arabia's benchmark stock index advanced 0.4% with most of its constituents posting gains, led by utilities, communication and industry stocks.

ACWA Power was up 2.3%, and MBC Group climbed 4% after the Middle East's largest private media firm reported a quarterly profit.

Dubai's benchmark stock index edged up 0.2%, lifted by gains in consumer staples, utilities and finance sectors with Mashreqbank rising 2.1%, and Emirates Central Cooling adding 1.4%.

In Abu Dhabi, the benchmark stock index was up 0.1% with conglomerate Alpha Dhabi gaining 2.2% and ADNOC Drilling climbing 3.7%.

The Qatari benchmark index rose 0.3%, helped by a 6.1% gain in United Development Co and a 1.8% rise in Barwa Real Estate Co.

Milder-than-expected U.S. Consumer Price Index data for April fuelled optimism that inflation was easing, prompting investors to raise bets that the Fed will cut its policy rate in September and December.

Most Gulf currencies are pegged to the dollar, and any U.S. monetary policy change is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.

(Reporting by Md Manzer Hussain; Editing by Sharon Singleton)