11 people have been killed and 27 others wounded after a car bomb exploded on Wednesday in a mostly Shi'ite Muslim neighbour of south-eastern Baghdad .

The violence came a day after the city witnessed one of its bloodiest days since U.S.-led air strikes against Islamic State insurgents in Iraq began in August.

The explosion occurred near a local market. Eight of those killed were civilians and three were policemen.

Another bomb exploded in Mahmoudiya, a predominantly Shi'ite town south of Baghdad, killing one civilian and wounding seven, police and medical sources said.

Baghdad has witnessed relatively few attacks compared to the violence in other areas hit by the offensive of Islamic State, who are ultra-radical Sunni Muslim militants, although bombs still hit the capital on a fairly regular basis.