A bomb explosion in the northern Israeli city of Hadera has wounded at least 16 people, in what police said was an apparent Palestinian militant attack.

None of the injured were seriously hurt.

The device was left in a rubbish bin outside a bank near the main market. It went off at 1115 local time (0915 GMT) when the area was crowded with shoppers.

Police immediately cordoned off the area and launched a search to make sure there were no other bombs hidden nearby.

Security was stepped up in the centre of town and police blocked off traffic.

Israel's Deputy Defence Minister Efraim Sneh said the bomb was a home-made device of the type used in three simultaneous pipe-bomb blasts which injured around 30 people in the nearby Mediterranean resort of Netanya.

The explosions on 7 November, came on the eve of final status peace talks with the Palestinians on the future of the occupied territories.

"Apparently these are the same terrorists who are trying to create a harmful atmosphere to the peace process," he said on Israeli radio.

A fax received by the Reuters news agency in Beirut in the name of a group calling itself the "Omar al-Mukhtar forces, occupied Palestine" said they had carried out the attack to target "Zionist gangs".

"Critical months"

Mr Barak, negotiating peace with the Palestinians and Syria, said he had just finished warning a closed-door meeting of parliament members that attacks were likely in coming months, when he learned of the explosion.

"These are critical months, and enemies of the peace... will try to carry out attacks in Israel, as we saw today, and also in Lebanon and abroad," said Mr Barak.

"It is a very serious event and our hearts are with the wounded," he said.

"I am confident we will put our hands on the terrorists who executed this attack."

Nabil Shaath, the Palestinian minister of planning, denounced the attack.

The attack occurred only days before Mr Barak is due to resume peace talks with Syria in the United States, and at a time when negotiations with the Palestinians are stumbling.