Investors look to whether the U.S. Federal Reserve will indicate faster monetary tightening this year, with the first rate increase of 2018 expected to be announced later in the day, by 1800 GMT.

Financial markets were trading cautiously on Tuesday and early on Wednesday, waiting for the Fed’s decision, as investors anticipated a quarter point hike in the Federal Reserve’s policy rate and awaited guidance on how many more to expect this year, while trade war fears kept export nations’ currencies on edge.

MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.4 percent after four straight days of losses, tracking overnight gains on Wall Street.

“A significant weighting toward four hikes this year may well cause both equity and bond markets to sell off,” Jonathan Sheridan, analyst at FIIG Securities in Sydney told Reuters.

“The concerns here are that the Fed overshoots with raising rates into a faltering economy,” Sheridan added.

In the Middle East, stock markets were mostly weak on Tuesday, failing to take cues from gains in oil prices, as most investors awaited a U.S. interest rate hike to be announced later today.

Egypt’s blue-chip index edged down 0.3 percent.

Egypt announced on Sunday the names of 23 state companies that it will sell stakes from this year under its plan to raise 80 billion Egyptian pounds ($4.6 billion) through minority share offerings on the Cairo bourse.

Mohamad Al Hajj, Head of MENA Equity Strategy at EFG Hermes told Trading Middle East by email: “Egypt is up 11 percent month-to-date vs 1 percent for Emerging markets and 3 percent for MENA equities; however, Egypt still trades at a discount to regional peers (Egypt’s 2018 P/E is 12x vs 13x for MENA and EM). We remain positive on the Egyptian market and see more upside.”

The region's biggest market, Saudi Arabia, was up 0.2 percent with financial stocks among the largest gainers ahead of an expected decision by FTSE at the end of this month to include Riyadh in its secondary emerging market index.

Al Rajhi Bank, the kingdom's second largest bank by assets, rose 1.7 percent, while Saudi British Bank was up 2.3 percent.

"It's been a waiting game until March 28 when a decision by FTSE is expected," Khaled Feda, senior research manager at Alistithmar Capital told Reuters. "The banking sector is outperforming the Saudi market year-to-date. We expect nine out of the 12 listed banks to be included in the index." Feda added.

Dubai’s index was flat as banks dropped but healthcare and industrial firms edged higher. Emaar Properties rose 1.0 percent.

The Abu Dhabi index was down 0.4 percent.

In an announcement after the market close, Dubai's ruler said Aldar and Emaar Properties, the top Dubai-based developer, were partnering to launch local and international projects worth 30 billion dirhams ($8.2 billion).

In Qatar, the index rose 1.0 percent to its highest level in just over three weeks. The Al Rayan Qatar exchange-traded fund will list on Wednesday, giving the market a second locally listed ETF as part of efforts to improve liquidity and attract more investment.

Elsewhere in the Gulf, Kuwait’s index edged down 0.6 percent, Bahrain’s index dropped 0.5 percent, and Oman’s index fell 1.05 percent.

In commodities, oil prices added to gains early on Wednesday, as prices lifted as a result of concerns in the Middle East that the United States may reinstate sanctions on Iran.

U.S. West Texas Intermediate (WTI) crude futures were at $63.80 a barrel at 0230 GMT, up 26 cents, or 0.4 percent, from their previous close.

Brent crude futures were at $67.71 per barrel, up 29 cents, or 0.4 percent.

“The presence of the Saudi Crown Prince... in Washington and his clear agenda to ramp up pressure on Iran, has for me, been the key driver... of oil, which rose strongly,” Greg McKenna, chief market strategist at futures brokerage AxiTrader told Reuters.

In currencies, the dollar was nearly unchanged in early trading on Wednesday, as investors await the Fed’s decision later in the day.

The dollar index stood at 90.39, after having risen to 90.446 on Tuesday, its highest in almost three weeks.

Gold prices edged up early on Wednesday, as cautious investors turned into safe havens.

Spot gold was up 0.1 percent at $1,311.72 per ounce, as of 0118 GMT.

In other news, Morocco’s central bank said on Tuesday that it has kept its benchmark interest rate unchanged at 2.25 percent.

Saudi Arabia's Ministry of Finance said on Tuesday that the government sold 4.85 billion riyals ($1.29 billion) of domestic sukuk in a monthly sale by re-opening an issue originally made in January.

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