Jerusalem  - Israeli Prime Minister Ehud Olmert vehemently condemned a Palestinian rocket attack on an Israeli shopping mall Wednesday, and vowed Israel would take steps to stop the rocket fire from Gaza.

"What happened today is entirely intolerable and unacceptable," Olmert told an international conference in Jerusalem, celebrating the 60th anniversary of Israel's establishment, and attended by US President George W Bush, as well as hundreds of other leaders and dignitaries from around the world.

"We will take the necessary steps so that this will stop," he said.

"The president came for a mission of peace and friendship, and he was fully aware of the complexities and sensitivities, the tensions and fears that so many Israelis face living in Israel in the south part of our country."

In his address, Olmert lavished praise on Bush, calling him a "great friend" and a "force of inspiration."

"We are very proud that we can celebrate the 60th anniversary of the state of Israel with you and your wife here in our eternal capital, in Jerusalem," he said to loud applause.

At least 16 Israelis were injured and more than 60 treated for shock, when the rocket penetrated the third floor of the shopping mall in the southern Israeli coastal city of Ashkelon. The rocket left a large, gaping hole in the roof of the mall and struck a clinic on the floor.

Israel's Channel 10 television quoted a senior government official as saying that Bush's presence would not prevent an immediate Israeli response to the rocket attack, which he said hurt both the Bush visit and Israel's 60th anniversary celebrations. (dpa)