Portugal Colonial - At least two killed in Tel Aviv shooting

The attack sparked mayhem in Dizengoff Street, a popular nightspot full of bars and restaurants.

It was not immediately clear who was responsible for the shooting, which came with Israeli security forces already on high alert.

But the Palestinian Islamist movement Hamas, which controls the Gaza Strip, and the Islamic Jihad welcomed the attack.

"It's an atmosphere of war. Soldiers and police are everywhere... They searched the restaurant, and people are crying," said Binyamin Blum who works in a restaurant near the scene.

Two people were killed and four others seriously wounded, the Magen David Adom emergency service said.

"Sixteen people evacuated to hospitals, two dead, four seriously wounded," said spokesperson Zaki Heller.

Tel Aviv's Ichilov Hospital confirmed that two people were killed and eight wounded.

"Most of them were severely wounded with various kind of injuries mainly in the thoracic area, in the abdomen, and some in the face," hospital director Ronni Gamzu told AFP.

Police spokesman Barouch Honig said more than 1,000 policemen were deployed in Tel Aviv.

They cordoned off the scene of the attack, asking people to stay indoors "while they track down suspects", a police statement said.

Unverified social media images showed panicked people fleeing the scene, with glass carpeting the ground.

- 'State of alert' -

Outside a cafe, a man comforted a woman sitting on a bar stool as heavily armed police deployed nearby.

Witnesses told AFP they had heard gunshots.

Brenda Ehrlich, 31, an insurance agent from the Tel Aviv suburb of Holon, said she learnt of the attack as she rode a bus into the city to celebrate a friend's birthday.

"I feel in a state of alert," she said, as she and her friends took cover.

"I feel like I need to look in all directions to not be caught by surprise. We were thinking of heading home but it feels a little dangerous so we might stay inside in Tel Aviv before we go home," Ehrlich added.

Prime Minister Naftali Bennett was at army headquarters in the coastal city receiving updates on the fourth attack in just over two weeks in Israel.

He was briefed on "the sequence of events in the attack... as well as efforts currently being made on the ground to locate the terrorist", a spokesperson for the premier said.

On March 29, a Palestinian gunman opened fire with an M-16 assault rifle in Bnei Brak, a mostly Jewish Orthodox city near Tel Aviv.

He killed two Ukrainian men and two Israeli civilians. An Arab-Israeli officer died of wounds sustained in an ensuing gunfight that also killed the assailant.

Two days earlier, "terrorists" opened fire and killed two police officers in the northern city of Hadera before officers shot dead the assailants, police said.

On March 22, a convicted Islamic State group sympathiser killed four Israelis in a stabbing and car-ramming spree in the southern city of Beersheba.

And last Saturday, Israeli security forces killed three members of the Islamic Jihad militant group who had opened fire during an operation to arrest them near the northern West Bank city of Jenin.

Four Israeli soldiers were wounded, one of them seriously, in the operation, police said.

- Fears of escalation -

Hamas praised the latest attack.

"Hamas congratulates the heroic operation that took place this evening, in the middle of so-called Tel Aviv, which led to the killing of a number of occupying soldiers and Zionist settlers," it said in a statement.

"It is a natural response in defence of our people and our sanctity and sanctuary."

There was also praise from the Gaza-based Islamic Jihad.

One of its leaders, Yussef al-Hasainah, said: "It confirms that the resistance can penetrate the security system... and that the resistance will continue and that it is the best choice to deter the arrogant enemy".

The Tel Aviv attack also came with Israeli police on alert for the first Friday prayers of the Muslim holy month of Ramadan at Al-Aqsa Mosque in annexed east Jerusalem.

The third-holiest site in Islam, it is a flashpoint in the long-running Middle East conflict and scene of frequent clashes.

P.Cavaco--PC