Israel imposes complete siege on Gaza, vows to punish region

Israel imposed a total siege on the Gaza Strip on Monday and cut off the water supply as it kept bombing targets in the Palestinian enclave in response to the Hamas surprise assault it has likened to the 9/11 attacks.

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Reeling from the Islamist unprecedented group's ground, air and sea attacks, Israel has counted over 700 dead and launched a withering barrage of strikes on Gaza that have killed 560 people there.

The skies over Gaza were blackened by plumes of smoke from deafening explosions as Hamas kept launching rockets as far as Tel Aviv and Jerusalem, where missile defence systems fired and air raid sirens blared.

Hamas-whose militants surged into Israeli towns on Saturday, sprayed gunfire at civilians and dragged off hostages-claimed about 100 on Monday that Israeli air strikes had killed four of the captives.

Israel said it had called up 300,000 army reservists, and truck convoys were seen moving tanks to the south, where its forces had dislodged the last holdout Hamas fighters from embattled towns.

"We are in control of the communities," said military spokesman Daniel Hagari, cautioning that some "terrorists" may remain after about 1,000 militants swarmed into the region on the Jewish Sabbath.