Most stock markets in the Gulf ended lower on Wednesday as traders bet that the U.S. Federal Reserve would be cautious in cutting interest rates after data showed the country's economy was stable.

Data on Tuesday showed U.S. job openings unexpectedly increased in November while hiring softened, suggesting the labour market slowed at a pace that probably does not require the Fed to be in a rush to cut rates.

Fed decisions have a significant impact on the Gulf region's monetary policy as most of its currencies are pegged to the dollar.

The Fed in December projected just two rate cuts for 2025, lower than the four it had earlier predicted. Markets are currently pricing in even less than that at 38 basis points, with the first cut fully priced in for July.

Investor focus in 2025 will likely be on shifting U.S. rate expectations, the growing divergence in policy path between U.S. and other economies, and the threat of tariffs once President-elect Donald Trump steps into the White House on Jan. 20.

Saudi Arabia's benchmark index <.TASI> fell 0.2%, hit by a 1.1% fall in Al Rajhi Bank <1120.SE> and a 1.6% decrease in Saudi Telecom Company <7010.SE>.

However, Nice One Beauty Digital Marketing <4193.SE> surged 30% on its debut trade to 45.5 riyals per share from an offer price of 35 riyals.

Dubai's main share index <.DFMGI> lost 0.1%, ending two sessions of gains, with toll operator Salik Company <SALIK.DU>.

In Abu Dhabi, the index <.FTFADGI> added 0.3%, led by a 2.8% jump in the country's biggest lender First Abu Dhabi Bank <FAB.AD>.

Abu Dhabi bourse finished in positive territory, driven by strong performance in the financial sector, particularly banking stocks. Recovering oil prices provided some support, said George Pavel, general manager at Naga.com.

Qatari index <.QSI> closed flat.

Outside the Gulf, Egypt's blue-chip index <.EGX30> dropped 0.5%.

According to Pavel, Egypt's market declined amid persistent uncertainty, with economic indicators showing continued business activity contraction and increasing price pressures, creating a challenging environment for market sentiment.

SAUDI ARABIA

<.TASI> fell 0.2% to 12,089

Abu Dhabi

<.FTFADGI> rose 0.3% to 9,466

Dubai

<.DFMGI> eased 0.1% to 5,209

QATAR

<.QSI> closed flat at 10,451

EGYPT

<.EGX30> lost 0.5% to 29,786

BAHRAIN

<.BAX> was up 0.2% to 1,978

OMAN

<.MSX30> down 0.1% to 4,597

KUWAIT

<.BKP> added 0.3% to 7,973

(Reporting by Ateeq Shariff in Bengaluru; Editing by Shinjini Ganguli)