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At least two women and one girl were seriously wounded and several other people were slightly hurt, said Leah Malul, an official at Barzilai Hospital in Ashkelon.

The Magen David Adom rescue service said 14 people were wounded - three seriously - and all the casualties had been evacuated from the site of the attack.

Islamic Jihad claimed responsibility for the attack in a statement on its Web site.

Witnesses told Israeli radio stations that the rocket caused considerable damage and rescue service director Eli Bean said at least two people had been trapped under the rubble. The two were rescued and taken to hospital, Army Radio reported.

Army Radio said the rocket hit the third floor of the Hutzot mall. The report said a clinic takes up part of the floor.

The rocket attack came as President Bush wrapped up talks in Jerusalem with Israeli Prime Minister Ehud Olmert. The Israeli leader said at the end of the talks that Israel would not tolerate attacks from Gaza militants.

Two people have been killed in recent days in attacks by Palestinian militants on Israeli communities outside Gaza.

The homemade rockets militants usually fire at Israel do not have enough range to reach Ashkelon. Militants use longer-range rockets to hit the city of 100,000, 9 miles from the Gaza-Israel border.

Speaking before learning of the attack on Ashkelon, Olmert said; "We will not be able to tolerate continuous attacks on innocent civilians. We hope we will not have to act against Hamas in other ways with the military power that Israel hasn't yet started to use in a serious manner in order to stop it."

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