JEBALIYA REFUGEE CAMP, Gaza Strip (AP) – Israeli troops and aircraft hit hard at Palestinian militants Saturday, killing at least 10 on the third bloody day of a massive Israeli incursion into the Gaza Strip’s largest refugee camp, as masked Hamas gunmen vowed more rocket attacks on Israeli towns.

About 2,000 soldiers have taken control of a 5-mile-deep chunk of northern Gaza to counter militants firing homemade rockets into Israel.

At least 50 Palestinians and five Israelis have been killed in four days of violence during the offensive, launched after a Hamas rocket killed two Israeli preschoolers in a town near Gaza on Wednesday.

The fighting once again plunged the encircled, poverty-stricken Gaza Strip into scenes of anguish. Mothers wept over their children’s corpses, tank fire ripped through groups of militants and bystanders, stone-throwing youngsters faced off against well-armed Israeli troops and tires burned in the streets to confuse Israeli spy drones.

The offensive has brought Israeli troops into Jebaliyah – the largest Palestinian refugee camp and one of the most crowded places in the world, with 106,000 people in half a square mile.

Palestinian gunmen dug in, fortifying positions in Jebaliyah and two other nearby towns also commandeered by Israel. Militant groups on Saturday called a commercial strike that closed most shops and businesses in Gaza.

Palestinian leader Yasser Arafat denounced the Israeli offensive as “monstrous,” but his prime minister, Ahmed Qureia, warned against the consequences of firing missiles into Israel.

Israeli aircraft killed at least five Palestinian militants Saturday, included two targeted from a helicopter while traveling in a car. Troops also shot dead four Palestinians who managed to cut through the Gaza border fence and approach an Israeli communal farm.

In the missile strike on the car, the army said one of the men killed was a senior militant responsible for the production of rockets. The other militant specialized in training recruits, the army said.

The buffer zone Israel created may help stop militants from firing homemade Qassam rockets into Israel. But any lull in rocket fire will likely only be temporary – unless Israel stays in the camp indefinitely.

Capt. Sharon Feingold, an Israeli army spokeswoman, said the five-mile buffer zone matched the Qassam’s current range.

“So at this time we believe we have dramatically reduced the terrorist organizations’ capability to hit an Israeli town and target Israeli children.”

She added that Israel may have to stay in the camp for a long time, but did not say how long.

The campaign, code-named “Days of Penitence,” is by all accounts just getting started. Officials said the operation will be open-ended – Prime Minister Ariel Sharon’s answer to the militant rocket attacks that threaten to turn public opinion against his planned withdrawal from the Gaza Strip in 2005.

Yet the militant Hamas group on Saturday said Israel should not only expect more rockets – but longer-range ones that will strike deeper and deeper into the Jewish state.

In their first-ever news conference, members of the secretive Hamas military wing, Izzedine al Qassam, threatened to launch rockets at the Israeli coastal city of Ashkelon, which is 10 miles north of Gaza and has been out of reach of the rockets.

Wearing black masks, four Hamas gunmen said the group has been working to expand the rocket range.

The group held the news conference at a mosque in Jebaliya, just a few blocks from Israeli tanks. The gunmen displayed assault rifles, grenades, rocket-propelled grenade launchers and homemade anti-tank missiles on a table before them.

One of the gunmen read from the Quran and then vowed that his group would exact “revenge for spilling of our martyrs’ blood.”

The militants said 15 armed Hamas men have been killed in recent days.

In the West Bank city of Ramallah, Prime Minister Qureia urged militants groups “to think about the higher national interest and not give Israel excuses to continue the aggression against our people in Gaza.”

Arafat referred to Israel’s campaign as a “monstrous, criminal, inhumane attack on our people.”

The commercial strike ordered by militant groups was widely observed in Gaza, but compliance was only partial in the West Bank.

Gaza radio stations broadcast warnings by the militant Al Aqsa Martyrs’ Brigades that shopkeepers ignoring the strike would be punished. Children were let out of schools for what Al Aqsa said in a leaflet would be a “day of rage” against Israel.

Near the Jewish settlement of Kfar Darom in central Gaza, about 200 school children threw rocks at soldiers, drawing army fire. Two teens, ages 14 and 16, were wounded, hospital officials said.

The Israeli military, meanwhile, continued to send more forces into northern Gaza. The area controlled by Israel included the towns of Beit Hanoun and Beit Lahiya, and the Jebaliya camp.

Meanwhile, along the Gaza-Egypt border, Israeli troops shot and critically wounded a 25-year-old pregnant Palestinian woman while demolishing a house, witnesses and hospital officials said. The army did not immediately comment.