At least 17 Palestinians have been killed and 200 wounded in the bombardment of an area of Shujayea during a "humanitarian pause" unilaterally announced by Israel.

The attack came on the outskirts of the Shujayea, between Gaza City and the Israeli border, shortly after the Israeli army said it was observing a limited, four-hour Wednesday ceasefire from midday GMT, or 3pm local time.

Al Jazeera understands that at least three air strikes or artillery rounds hit the area, which is a collection of warehouses, a market, shops and homes. Residents flooded the streets to help those injured in the first explosion, about 100m from the market, exposing them to more shelling.

An Israeli military spokeswoman told Al Jazeera that it was checking the reports but added that Shujayea - which was heavilly bombarded last week killing scores of people - was not in the areas covered by its humanitarian pause.

"The first shell hit, and people immediately started evacuating the wounded," a man called Abu Maysarah told the AFP news agency. "They [the Israelis] saw them evacuating the wounded, and they struck them again."

Another witness, who spoke to Al Jazeera from Shifa hospital, said many at the scene of the attack tried to put out fires that had started.

"The fire hit one of the shops, and started to spread to all the market," he said. "We ran to help fight it ... suddenly the cannon shells started to hit all of us while we were rescuing people."

Hamas condemned the deaths as "another blatant massacre".

"The Israelis are committing deliberate acts of mass murder... the blood of innocent people in Gaza will not be shed in vain and the hand of justice will reach all of those who planned and carried out these massacres."

Al Jazeera's Nicole Johnston, reporting from Gaza City, said that the death toll was likely to increase given the numbers injured.

Johnston said there had been no let-up in the attacks during the Israeli pause.

"There has been a lot of death in the last two hours," she said as the pause was coming to a close. "The ceasefire has not been particularly useful. There has been no change - up to 100 people have been killed today alone."

Gaza's Health Ministry said 1,363 Palestinians have been killed and more than 6,780 injured since Israel's offensive in the Gaza Strip began on July 8.

Fifty-eight Israelis have been killed, including 56 soldiers and two civilians.

Hamas spokesman Sami Abu Zuhri had earlier dismissed the Israeli pause. He told Reuters: "The ceasefire Israel declared is for the media and has no value because it does not include the areas of conflict on the border."

Mohammed Omer contributed to this report.