Major stock markets in the Gulf were subdued in early trade on Tuesday, as ​caution prevailed ahead ⁠of a deadline set by U.S. President Donald Trump ‌for Iran to reopen the Strait of Hormuz to all shipping.

Markets have been ​on edge since the U.S.-Israel war on Iran erupted in late February, with ​Tehran effectively ​closing the Strait of Hormuz, a critical chokepoint for global oil supplies, and stoking fears of higher inflation.

Investors had ⁠hoped diplomatic efforts would help bring the conflict to an end, but talks have so far made no progress. Trump has set a deadline of 8 p.m. Eastern Time on Tuesday (0000 GMT Wednesday) ​for a ‌deal to be ⁠reached.

Iran said ⁠on Monday it wanted a lasting end to the war with the United ​States and Israel, but pushed back ‌against pressure to reopen the Strait, while ⁠Trump warned the country could be "taken out" if it failed to meet his deadline.

The uncertainty has kept investors in a risk-off mood, with the U.S. dollar holding gains and oil prices rising sharply on Tuesday.

Saudi Arabia's benchmark index dropped 0.5%, with a 0.2% fall in Al Rajhi Bank and a 1.6% decline in Saudi Basic Industries Corp.

The kingdom said on Tuesday it ‌intercepted and destroyed seven ballistic missiles launched towards its ⁠Eastern Region, with debris falling near energy facilities, ​according to the defence ministry.

Dubai's main share index lost 0.3%, with blue-chip developer Emaar Properties declining 2.3%.

In Abu Dhabi, the index eased ​0.3%.

The Qatari ‌index edged 0.1% higher, helped by a 0.8% rise ⁠in Qatar Islamic Bank.

(Reporting ​by Ateeq Shariff in Bengaluru; Editing by Eileen Soreng)