Fresh violence has erupted between Israel and Gaza after air strikes bombarded the Palestinian territory.

Explosions lit-up the night sky above buildings in Gaza City as Israeli forces shelled the Palestinian enclave on Wednesday.

The strikes were in response to incendiary balloons that had been launched from the Gaza Strip, the military said.

It comes after 11 days of fierce fighting in the region last month left scores dead and yet more injured, and is also the first violence since Israel formed a new government.

The Israeli military said its aircraft attacked Hamas armed compounds in Gaza City and the southern town of Khan Younis.

It said it was "ready for all scenarios, including renewed fighting in the face of continued terrorist acts emanating from Gaza."

Explosions light-up the night sky
The Israel military has confirmed the attacks

The strikes, the military said, came in response to the launching of the balloons, which the Israeli fire brigade reported caused 20 blazes in open fields in communities near the Gaza border.

A Hamas spokesman, confirming the Israeli attacks, said Palestinians would continue to pursue their "brave resistance and defend their rights and sacred sites" in Jerusalem.

Hours earlier, thousands of flag-waving Israelis congregated around the Damascus Gate of Jerusalem's Old City before heading to Judaism's holy Western Wall, drawing Palestinian anger and condemnation.

Israel, which occupied East Jerusalem in a 1967 war and later annexed it in a move that has not won international recognition, regards the entire city as its capital.

Flames are seen after an Israeli air strike hit Hamas targets
Hamas has vowed to 'defend their rights'
Flames are seen after an Israeli air strike hit Hamas targets
The strikes were said to be in response to incendiary balloons

Palestinians want East Jerusalem to be the capital of a future state that would include the West Bank and Gaza.

Before Tuesday's march, Israel beefed up its deployment of the Iron Dome anti-missile system in anticipation of possible rocket attacks from Gaza.

But as the marchers began to disperse after nightfall in Jerusalem, there was no sign of rocket fire from the enclave.

The procession was originally scheduled for May 10 as part of "Jerusalem Day" festivities that celebrate Israel's capture of East Jerusalem.

At the last minute, that march was diverted away from the Damascus Gate and the Old City's Muslim Quarter, but the move was not enough to dissuade Hamas from firing rockets towards Jerusalem, attacks that set off last month's round of fighting.

It comes after a flare-up of violence left more than 200 Palestinians dead, including 65 children, and a dozen killed in Israel nearly a month ago.

In the wake of the worst flare-up of violence in years Foreign Secretary Dominic Raab welcomed the end of hostilities and called on Hamas to halt the firing of rockets on Israel.