heard as a helicopter flew overhead. Pro-Russian gunmen in the town retreated to defensive positions.

A spokeswoman for the separatists, Stella Khorocheva, said that all civilians had been ordered out of the town hall.

"The armed men handling the defence of the town hall will remain," she said.

Russia has ordered new military exercises in Russian regions bordering Ukraine in response to the operation against militants.

"We are compelled to react to such a situation," Defence Minister Sergei Shoigu was quoted as saying by Russian news agencies at a meeting of the defence ministry.

"From today, military exercises have started in regions bordering Ukraine involving battalions of tactical forces of the southern and western military districts," he said.

He said that the exercises were a forced measure in response to fatalities during Ukraine's militaryoperation against separatists who have occupied eastern cities close to the Russian border.

"The situation in Ukraine provokes serious concern. From 22 April the new Ukrainian leadership has begun the so-called active phase of an operation in the southeastern borders of Ukraine. There are already people killed," Mr Shoigu said.

"A start has already been made in using weapons against peaceful citizens of their own country. If this war machine is not stopped today, then it will lead to a large number of dead and wounded."

Earlier, the Ukrainian government said soldiers had regained control of the town hall in the southeastern port city of Mariupol and repelled an attack on an army base in the eastern town of Artemivsk.

Ukraine's military clashed with pro-Russian separatists in two eastern towns overnight, the