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Two Palestinians were killed in clashes over US President Donald Trump's recognition of Jerusalem as Israel's capital.
The Palestinian health ministry said Israeli soldiers shot dead one Palestinian man on Friday near the Gaza border.
A second man was reported killed by Gaza's health ministry but not details were immediately available.
The Israeli military said hundreds of Palestinians were rolling burning tyres and throwing rocks at soldiers across the border.
"During the riots Israel Defence Forces (IDF) soldiers fired selectively towards two main instigators and hits were confirmed," the army statement said.
The Trump administration's move to recognise Jerusalem as Israeli has angered Palestinians, sparking protests across the region and wider Muslim world.
Various Palestinian groups, including militant organisation Hamas, called for a day of rage on Friday against the US and Israeli occupation.
An estimated 3,000 people marched, burned Israeli flags and stamped on posters of Trump in around 30 protests across the Palestinian Territories.