Palestinians react to destroyed homes in the Shejaia neighbourhood, which was heavily shelled by Israel during fighting, in Gaza City July 20, 2014. At least 50 Palestinians were killed on Sunday by Israeli shelling in a Gaza neighbourhood, where bodies were strewn in the street and thousands fled for shelter to a hospital packed with wounded, witnesses and health officials said. Militants kept up their rocket fire on Israel, with no sign of a diplomatic breakthrough toward a ceasefire in sight.

Gaza City, Palestinian Territories - The death toll in Gaza passed 400 on Sunday as Israel pressed its biggest offensive in the enclave in five years, Palestinian health officials said.

“410 people have been killed since the war started and more than 3,020 people have been injured, most of them civilians,” deputy health minister Yussef Abu Rish told reporters at Shifa hospital in Gaza City.

The vast majority of Sunday's dead were in the Shejaiya neighbourhood between Gaza City and the Israeli border, where more than 50 people were killed in a blistering bombardment which began overnight, medics said.

Following an urgent appeal from the International Committee of the Red Cross, both sides agreed to halt fire in the neighbourhood, with a two-hour humanitarian lull going into force at 12:30 SA time.

As the ceasefire got under way, a convoy of ambulances entered Shejaiya, with medics seen picking up at least three dead bodies, including that of a man with his intestines hanging out and his head completely destroyed, an AFP correspondent reported.

But shortly afterwards, the sound of small arms fire was heard in the area.

The Israeli army said Hamas had “not stopped shooting” and that it was responding accordingly. - Sapa-AFP