Carnage in Somali market shelling
About 40 people have been killed in the Somali capital, mostly when shells were fired on the busy Bakara market.
Witnesses say Ethiopian troops fired mortars after insurgents launched simultaneous attacks on the two main African Union peacekeeping bases.
"There is blood everywhere, and human flesh on the walls," said market trader Abshir Mohamed Ali.
Eleven people were killed when a shell landed in an alleyway, while six family members died overnight, they say.
Correspondents say the clashes are among the fiercest in Mogadishu for several months.
They say hospitals are overwhelmed with all the wounded.
Meanwhile, a kidnapped German and his Somali wife have been freed.
They were released by police in the semi-autonomous north-eastern region of Puntland, officials say.
They were seized at gunpoint over the weekend.
The Ethiopian troops are backing government forces against the Islamist insurgents.
About 30 people died in Bakara, after at least eight were killed in the overnight clashes, witnesses say.
Ali Mohamed Siyad, who chairs Bakara market traders’ association, said the shelling was a "disaster".
He told the BBC that it came as large numbers of people were shopping ahead of next week’s Eid festival to mark the end of the Muslim holy month of Ramadan.
On Friday, the police said insurgents had launched attacks from the market.
The BBC’s Mohammed Olad Hassan says the AU bases near the airport and in the K4 district were attacked overnight.
"A mother and her five children died when a mortar hit their house," elder Mohamed Hussein told the AFP news agency.
"Minutes later, two neighbours who rushed to assist them died in the same house after another mortar shell struck," he said.
The fighting is so fierce that people were unable to go and collect the bodies of those killed.
Our correspondent says two medical staff and a patient were wounded when a mortar hit a mental hospital.
AU spokesman Baridgye Bahuko said there had been no casualties among the peacekeepers.
On Friday, an AU plane became the first aircraft to land at the main Mogadishu airport for four days, after insurgents from the al-Shabab group threatened to shoot down planes.
This led to fierce battles on Friday.
Representatives from the government and Islamist groups again delayed a ceasefire they had been due to sign on Friday in neighbouring Djibouti.
They could not agree on the wording of a statement on the withdrawal of Ethiopian troops from the country.
The Ethiopians intervened in 2006 to help the government oust Islamist forces from the capital and surrounding regions.
Islamist fighters from the al-Shabab group are not involved in the Djibouti talks.
They have said they would step up attacks during Ramadan.
Only Uganda and Burundi have contributed troops to the AU peacekeeping force, which has just 2,000 troops of the 8,000 planned.
Somalia has been wracked by conflict since 1991, when former President Mohamed Siad Barre was overthrown.
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