Israel formed an emergency unity government on Wednesday as its jets pounded Gaza and tanks massed around the densely populated Palestinian enclave while Hamas fighters said they were still fighting on Israeli territory following their shock weekend incursion.

Prime Minister Benjamin Netanyahu agreed to form a war cabinet with former defence minister and centrist opposition party leader Benny Gantz and focus entirely on the conflict, a joint statement from Gantz’s National Unity party said.

Israel’s death toll rose to 1,200 with over 2,700 wounded, its military said, from Hamas fighters’ hours-long rampage after breaching the fence enclosing Gaza on Saturday.

US President Joe Biden has issued a warning seemingly aimed at Hamas’ Iranian supporters not to exploit the Gaza conflagration to start a wider Middle East war.

Israeli reprisal strikes on blockaded Gaza have killed 1,100 people and wounded 5,339, Gaza’s Health Ministry said. Some 535 residential buildings had been destroyed leaving around 250,000 homeless, Hamas officials said. Most of the displaced were in UN-designated shelters, others huddling in shattered streets.

Read also: More than 260,000 people displaced in Gaza as brutal Israeli reprisal continues

The group’s armed wing, the Al Qassam Brigades, said it was still fighting inside Israel on Wednesday. Israel deployed tanks and armoured vehicles just north of Gaza where the clashes were reported, but had no immediate comment on the Hamas claim.

Later in the day, alerts warning of incoming aircraft were issued across northern Israel, well removed from Gaza in the south, but the Israeli military subsequently said these may have been a malfunction.

A Reuters TV crew saw a house hit by an apparent projectile near Metulla in Israel’s far north, close to the border with south Lebanon where the heavily armed Iran-backed Hezbollah group is active.

Hamas’s armed wing said it had targeted the northern Israeli coastal city of Haifa with an R60 rocket. There were no immediate reports of casualties after sirens sounded in Haifa and nearby towns.

Israelis take cover in a bomb shelter while sirens sound as rockets from Gaza are launched towards Israel, in Ashkelon, southern Israel, October 11. PHOTO: REUTERS

Israel has vowed swift punishment for the deadliest Palestinian attack in its 75-year history, which left corpses strewn around a music festival and a kibbutz community.

The military said dozens of its fighter jets struck more than 200 targets in a neighbourhood of Gaza City overnight that it said had been used by Hamas to launch its attacks.

Smoke billows following Israeli strikes in Gaza City, October 11. PHOTO: REUTERS

“We started the offensive from the air, later on we will also come from the ground,” Defence Minister Yoav Gallant told soldiers near the fence on Tuesday.

Israel has put Gaza under “total siege” to stop food and fuel reaching the enclave of 2.3 million people, many poor and dependent on aid. Hamas media said on Wednesday electricity went out after the only power station stopped working.

With Palestinian rescue workers overwhelmed, others in the crowded coastal strip joined the search for bodies in rubble.

“I was sleeping here when the house collapsed on top of me,” one man cried as he and others used flashlights on the stairs of a building hit by missiles to find anyone trapped.

The Israeli military said its troops had killed at least 1,000 Palestinian gunmen who infiltrated from Gaza and the Chief of the General Staff met commanders to discuss their next steps.

“Wherever there are Hamas leaders – the IDF strikes with precision and power,” it said, referring to Israel’s military.

The debris of houses destroyed in Israeli strikes, in Khan Younis in the southern Gaza Strip, October 11. PHOTO: REUTERS

West Bank violence

Scores of Israelis and others from abroad were taken to Gaza as hostages, some of whom were paraded through streets. Both sides have said many women and children were among the dead and wounded, and distraught relatives have held multiple funerals.

Mourners at the funeral of Palestinian members of al-Agha family, who were killed in Israeli strikes, in Khan Younis in the southern Gaza Strip, October 11. PHOTO: REUTERS

Israel said it was shifting schools to remote learning from Sunday and issuing more firearms to licensed citizens, predicting possible friction between its majority Jews and Arab minority amid calls for more protests in support of Gaza.

Israeli security forces have killed at least 27 Palestinians during clashes in the occupied West Bank since Saturday, as Palestinian factions called on people in the Palestinian territory to rise up following Hamas’ strike from Gaza.

The acting governor of the West Bank city of Nablus, Ghassan Daghlas, said Palestinians were shot at and reportedly wounded by Israeli settlers. Reuters could not immediately verify the report and there was no immediate Israeli comment.

In another sign of the crisis widening, Israeli shelling hit southern Lebanese towns after a rocket attack by the powerful Hezbollah in the fourth consecutive day of violence there.

A ground offensive into Gaza carries risks for Israel, notably to the hostages held in the narrow, widely urbanised enclave. Hamas has threatened to execute a captive for each home hit without warning.

Palestinian sources said one of the homes Israeli air strikes hit in Gaza overnight killed three relatives of Hamas military wing chief Mohammed Deif, the secretive mastermind of the assault, which was planned for two years.

Read: Who is Mohammed Deif, the Hamas commander behind the attack on Israel?

Israel withdrew settlers and troops from Gaza in 2005 after 38 years of occupation. An Israeli blockade since Hamas seized power in the enclave in 2007 has created conditions which Palestinians say are intolerable.

Washington said it was talking with Israel and Egypt about safe passage for civilians from Gaza, with food in short supply.

Hussein Al-Sheikh, an official in the West Bank-based Palestinian Authority, said the international community must intervene urgently to avert “a major humanitarian catastrophe”.

Palestinians carry a casualty on rubble in the aftermath of Israeli strikes, in Khan Younis in the southern Gaza Strip, October 11. PHOTO: REUTERS

International reaction

Biden called the Hamas attacks “an act of sheer evil” and said Washington was rushing military assistance to Israel, including to replenish its Iron Dome aerial defence system.

He urged Israel to avoid causing civilian casualties and said the US had strengthened its presence in the region by moving an aircraft carrier strike group and fighter aircraft.

Also read: Blinken to Israel on Middle East mission to prevent a wider war

US Secretary of State Antony Blinken was set to leave for Israel later on Wednesday in a show of solidarity and to work with regional US allies to try to secure the release of over 100 people Israel says Hamas took captive.

US officials say they do not have evidence Iran orchestrated the attacks, but point to the Islamic Republic’s long-term support for Hamas.

A man holds his dog after a rocket, launched from the Gaza Strip, landed in Ashkelon, southern Israel, October 11. PHOTO: REUTERS