Three bomb blasts rocked a busy market in Iraq's capital on Sunday, killing at least eight people and wounding 26 others, police and hospital sources said.

The blasts occurred in Shurja, an important commercial district in central Baghdad, on the first day of the Muslim festival of Eid al-Adha.

I can see fire and black smoke mounting and a large number of fire engines, ambulances and police patrols rushing to the market, a Reuters witness close to Shurja market said.

A source at al-Kindi hospital in Baghdad said the facility had received eight dead and 26 wounded from the attack.

Iraqi forces are preparing to take full responsibility for security by year-end when all U.S. troops pull out of the country, nearly nine years after the U.S.-led invasion.

Military leaders have expressed concerns that militants might ramp up attacks as the 33,000 U.S. troops left in Iraq pack up to leave.

Although violence has dropped since the peak of sectarian fighting in 2006-7, bombings and killings occur on a daily basis and a stubborn Sunni insurgency linked to al Qaeda and Shi'ite militias remain capable of carrying out lethal attacks.

The number of civilians killed in violence in Iraq climbed sharply in October following a string of suicide and roadside bombings in Baghdad. Attacks have also increased against Iraq's army and police.

(Reporting by Kareem Raheem; Writing by Serena Chaudhry)