Hawa Amed, a 40-year-old mother of eight, said she had wanted to stay in her house deep in the sprawling Bakara Market, where allied Somali-Ethiopian troops have been hunting for the guerrillas and their hidden arms caches over the weekend.

"But after two policemen were killed outside on Sunday, we had to run," she told Reuters as she left the city on foot, her youngest child strapped to her back. "We are now heading to Madina District ... we don't know how we will survive."

At least 70 people have been killed in more than a week of fighting that has driven tens of thousands of Somalis from their homes, residents and aid workers say.

Hundreds of thousands of civilians have fled the capital so far this year to escape several rounds of battles between the insurgents and interim government.

The latest fighting claimed the lives of nine out of ten members of one family on Monday. Only a nine-year-old girl survived when an artillery shell hit them as they tried to flee the rubble-strewn city.

Abdulahi Alas, an investigation officer with the local Ismail Jimale Human Rights Organisation, told Reuters it appeared the shell was fired by an Ethiopian unit.

Government security forces and Ethiopian soldiers are hunting for rebel weapons in and around Bakara Market, and on Monday the city's major Mohamed Dheere called on traders to return there and reopen their shops so they could be searched.

"We believe that a lot of wounded insurgents are hiding in Bakara and the surrounding areas," said one senior security officer who asked not to be named.

Ethiopian and Somali government troops have been battling insurgents in the Horn of Africa nation since Addis Ababa helped the interim administration rout a group of hardline Islamists from Mogadishu in January following a two-week war.

More than 200 people have been wounded in the latest fighting, residents, local media and human rights group say, mostly by stray bullets and shrapnel.

Also on Monday, the interim government ordered an independent local broadcaster, Shabelle Radio, off the air and briefly detained two of its senior staff.

Earlier this year, the authorities accused Shabelle and other Somali news organisations of supporting the rebels.

"This is an operation against the independent media," said Shabelle's acting director Jafar Kukay.