Most Gulf stock markets ended lower on Monday amid signs that U.S.-Iran ​talks have stalled, ⁠leaving the crucial Strait of Hormuz effectively closed. U.S. President Donald Trump on Sunday ‌dismissed Iran's response to a U.S. proposal for peace talks aimed at ending their war, calling Tehran's ​demands "totally unacceptable." Iran's proposal called for a comprehensive end to the war, sanctions relief, reparations and recognition ​of its ​control over the strait, Iranian media reported.

Iran has effectively closed the strait since the war began in late February, disrupting a vital corridor that typically carries about ⁠a fifth of the world's oil and gas.

Dubai's main share index fell 1.4%, hit by a 1.8% drop in blue-chip developer Emaar Properties and a 1.7% slide in toll operator Salik. Budget airline Air Arabia declined 2.1%. While relative calm has offered some support ​to sentiment, the ‌lack of progress ⁠in U.S.-Iran talks ⁠is keeping investors cautious and could weigh on stocks, said Joseph Dahrieh, managing director at Tickmill. In Abu ​Dhabi, the index retreated 0.5%, with Aldar Properties losing 2.3%.

The ‌United Arab Emirates' air defences intercepted two drones from ⁠Iran on Sunday, the defence ministry said, the latest in renewed attacks on the oil-rich Gulf state. Saudi Arabia's benchmark index gained 0.4%, led by an 8% surge in ACWA Power after it reported higher first-quarter revenue, despite a fall in profit.

Oil major Saudi Aramco added 0.8%, a day after reporting a 25% rise in first-quarter profit, as its East-West pipeline ran at full capacity to offset disruptions linked to the Strait of Hormuz.

The Qatari index eased 0.3%. A cargo vessel travelling from Abu Dhabi ‌was struck by a drone on Sunday in Qatari waters northeast ⁠of Mesaieed port, causing a small fire that was quickly ​contained, Qatar's defence ministry said. No injuries were reported, and the vessel continued to port.

Outside the Gulf, Egypt's blue-chip index fell 0.3%.

  • Saudi Arabia rose 0.4% to 11,158
  • Abu Dhabi lost 0.5% to 9,788
  • Dubai dropped 1.4% ​to 5,820
  • Qatar eased ‌0.3% to 10,631
  • Egypt down 0.3% to 54,475
  • Bahrain fell 0.2% to 1,929
  • Oman down 0.2% ⁠to 8,314
  • Kuwait declined 0.5% to 9,331

(Reporting ​by Ateeq Shariff in Bengaluru. Editing by Mrigank Dhaniwala and Mark Potter)