Oman's 2013 budget, announced late on Tuesday, envisages spending of US$33.5bn
Oman's index may climb further on Wednesday after the country said it would raise state spending by nearly 30 percent from the original 2012 plan in its budget for the new year. Other regional markets are expected to be upbeat because of positive global sentiment.
Oman's 2013 budget, announced late on Tuesday, envisages spending of OMR12.9bn (US$33.5bn) as the government provides social benefits it promised after Arab Spring protests in 2011.
Actual spending last year was around OMR13bn, 30 percent higher than planned, and analysts believe actual spending may continue increasing this year. The Omani finance minister is expected to reveal more details at a news conference on Wednesday morning.
The Oman index closed at a new seven-month high on Tuesday, climbing for a fourth straight session.
Regional bourses may also advance, taking their cue from Asian stocks. Asian shares hit a five-month high and the dollar fell on Wednesday as a last-minute deal ended the US "fiscal cliff" crisis that threatened a US recession and roiled world financial markets.
Saudi Arabia's index, which unlike most Gulf markets traded on Tuesday, closed 0.9 percent higher.
Dubai's market may aided to some extent by the emirate's release of its 2013 budget, which raises planned spending moderately while cutting the size of the deficit by 18 percent.
The market dropped on the last day of trading in 2012 after the central bank unexpectedly issued regulations curbing home mortgages. But it is unclear how strictly the rules will be enforced.