The explosion occurred during the morning rush hour, reports BBC Ukraine.
ISIS claimed responsibility for the blast, calling it an attack on Shia fighters.
ISIS, a Sunni extremist group, often targets Shiites, considering them heretics.
According to Iraqi officials, a lot of women and children were wounded in the blast, some of them critically. The blast also damaged the nearby buildings and vehicles.
Market areas are typically targeted by terrorists. In February, at least 70 people were killed in one of the bloodiest attacks in months after two blasts rocked an outdoor market in Baghdad’s Sadr City district.