By Ateeq Shariff

(Reuters) – Most stock markets in the Gulf were subdued on Sunday following a report suggesting Iran's potential retaliatory strike on Israel from Iraqi territory in the coming days.

The U.S. has warned Iran against launching another attack on Israel, stating that Washington would not restrain Israel if it retaliated again, according to Axios, which cited a U.S. official and a former Israeli official.

Israeli intelligence allegedly suggests Iran is preparing to attack Israel from Iraqi territory soon, potentially before the U.S. presidential election on Nov. 5.

Saudi Arabia's benchmark index increased by 0.2%, aided by a 3.2% rise in ACWA Power Company.

Among the gainers, MBC Group surged 10% – its daily maximum – following Istedamah's binding agreement with the Public Investment Fund to sell its entire stake in the media giant.

In Qatar, the index decreased by 0.2%, pressured by a 0.5% decline in Qatar National Bank, the Gulf's largest lender.

Outside the Gulf, Egypt's blue-chip index rose 0.6%, with Commercial International Bank gaining 1.3%.

The International Monetary Fund is set to review Egypt's loan program on Tuesday, as announced by Prime Minister Mostafa Madbouly during a press conference with IMF Managing Director Kristalina Georgieva.

• Saudi Arabia: rose 0.2% to 12,048
• Qatar: dropped 0.2% to 10,506
• Egypt: added 0.6% to 30,833
• Bahrain: eased 0.1% to 2,019
• Oman: remained flat at 4,747
• Kuwait: down 0.3% to 7,649