A cloud of smoke rises following an Israeli missile strike in the northern Gaza Strip on Friday. (Bernat Armangue/Associated Press)

Israel allowed hundreds of people with foreign passports to leave Gaza Friday as the aerial assault on the crowded Palestinian enclave continued for a seventh day.

Between 300 and 450 people passed through Israeli-run checkpoints to leave Gaza, which is ruled by the Palestinian militant group, Hamas. Most of those who left held American and eastern European passports, said Reuters.

"The situation is very bad. We are afraid for our children," said Ilona Hamdiya, a woman from Moldova married to a Palestinian. "We are very grateful to our embassy."

Gaza's roughly 1.4 million residents have been under sustained air assault since Saturday when Israel launched its attacks to stop Hamas from firing rockets at Israeli targets.

Palestinian officials say more than 400 people have been killed since the fighting started. The United Nations Humanitarian Coordinator for the Palestinian Territories says about 100 of those deaths were civilians. Four Israelis have been killed by Palestinian rocket attacks, officials said.

Israel warns residents

An Israeli army officer inspects the damage to a building after a rocket fired by Palestinian militants from the northern Gaza Strip hit the southern city of Ashkelon on Friday. (Tsafrir Abayov/Associated Press)

Hamas rocket fire didn't let up Friday, with a barrage landing in the city of Ashkelon near Gaza's northern border, striking an apartment building and wounding one person.

Israeli fighter jets bombed a mosque that the Jewish state says was used to store weapons and fired missiles at what were said to be the homes of several Hamas members.

Warplanes also bombed about 20 houses said to belong to Hamas members and people belonging to other armed groups, said Palestinians.

They also said the Israelis either warned nearby residents by phone or fired a warning sound bomb ahead of the attacks.

Leaflets with a confidential phone number to report the location of rocket squads were dropped into Gaza, Palestinians added.

Israel is not allowing foreign journalists into Gaza to cover the fighting, despite a court order handed down earlier this week that cleared the way for international media to cross into the territory in supervised groups.

That makes it more difficult to verify the nature of damage or casualties.

Invasion speculation

Palestinian holders of foreign passports arrive on the Israeli side of the Erez crossing, after leaving the Gaza Strip Friday. (Sebastian Scheiner/Associated Press)

Israel's decision to allow foreign passport holders to leave Gaza has heightened speculation it is about to launch a ground invasion, a move approved by the Israeli cabinet earlier this week. Russian officials, however, said the passport holders were allowed to leave at the request of foreign embassies.

Israeli soldiers and tanks remain massed along the Gaza border, while the army on Friday closed off the West Bank, barring nearly all of the area's more than two million Palestinians from entering Israel.

While Israel and Hamas have rejected a French proposal for a 48-hour ceasefire to send humanitarian supplies into Gaza, Israeli officials have hinted at a possible diplomatic end to the violence.

French president Nicolas Sarkozy is to travel to the Middle East next week to gather support for a cessation of violence.

Israel has said a key term for any ceasefire would be the presence of international observers to monitor Hamas.

Hamas has said it would require an end to Israeli air strikes and the reopening of the border crossings.

Hamas holding Gaza hostage: U.S.

In Washington, President George W. Bush said the United States was working to support a meaningful ceasefire but an end to the attacks would require international monitoring of Hamas and arms smuggling into Gaza.

In his weekly radio address, Bush said the rocket attacks by the Palestinian militant group were an "act of terror" that showed Hamas was more interested in violence that governing Gaza.

"I urge all parties to pressure Hamas to turn away from terror and to support legitimate Palestinian leaders working for peace," Bush said.

"Another one-way ceasefire that leads to rocket attacks on Israel is not acceptable."

Rallies against the Israeli attacks continued across the Islamic world Friday — the most important day of the week for Muslim prayer.

Roughly 60,000 people gathered in a stadium in Amman, Jordan, Friday to rally in support of Palestinians. The demonstration was led by the opposition Muslim Brotherhood, a group with ideological links to Hamas. Crowds cheered as the group's leaders called for intensified strikes against Israel.

Demonstrations against Israel's bombing campaign were also held in Iran, Egypt, Turkey, Iraq and Kashmir.

With files from Associated Press and Reuters