Stock markets in the Gulf ended mixed on Thursday amid tensions in the Middle East following the killing of Hamas leader Ismail Haniyeh in Iran, while expectations of rate cuts in the United States boosted investor sentiment.

Haniyeh's death came less than 24 hours after the most senior military commander of Lebanon-based Hezbollah was killed in an Israeli strike in Beirut. The killings fuelled concern that the 10-month-old war in Gaza between Israel and Hamas could turn into a wider Middle East conflict.

Saudi Arabia's benchmark index <.TASI> dropped 0.5%, hit by a 1.5% fall in aluminium products manufacturer Al Taiseer Group <4143.SE>.

The country's real gross domestic product (GDP) shrank 0.4% year-on-year in the second quarter, preliminary data by the government's statistical authority showed on Wednesday, driven by a 8.5% decline in oil activities which has limited overall growth for several quarters.

Petrochemical maker Saudi Basic Industries Corp <2010.SE> finished 0.8% higher, after the company reported an 85% surge in second-quarter profit.

Dubai's main share index <.DFMGI> gained 0.3%, led by a 1.1% rise in banking group Emirates NBD <ENBD.DU>.

In Abu Dhabi, the index <.FTFADGI> added 0.3%.

The U.S. Federal Reserve held interest rates steady overnight but opened the door to a cut in September.

Monetary policy in the six-member Gulf Cooperation Council (GCC) is usually guided by the Fed's decisions as most regional currencies are pegged to the U.S. dollar.

The Qatari benchmark <.QSI> closed 0.2% lower.

Outside the Gulf, Egypt's blue-chip index <.EGX30> eased 0.1%, with Talaat Mostafa Holding <TMGH.CA> losing 1.3%.

Cairo travellers faced price rises of as much as 30% for tickets on the city's metro on Thursday after the public transport operator hiked charges in response to a fuel price hike last week.

SAUDI ARABIA

<.TASI> fell 0.5% to 12,046

ABU DHABI

<.FTFADGI> rose 0.3% to 9,367

DUBAI

<.DFMGI> gained 0.3% to 4,280

QATAR

<.QSI> eased 0.2% to 10,131

EGYPT

<.EGX30> lost 0.1% to 29,359

BAHRAIN

<.BAX> was up 0.1% to 1,971

OMAN

<.MSX30> added 0.1% to 4,667

KUWAIT

<.BKP> dropped 0.4% to 7,865

(Reporting by Ateeq Shariff in Bengaluru. Editing by Jane Merriman)