Hundreds of mourners descended on the village of Al-Lubban in the northern West Bank on Wednesday for the funeral of a Palestinian intelligence officer who was shot by Israeli soldiers who claimed they had "neutralised" an armed terrorist. Ahmed Daraghmeh, an officer in the Palestinian Authority’s security service, died on Tuesday after Israel Defense Forces (IDF) soldiers mistook him for an armed militant and opened fire on the car he was in, killing him and critically injuring another Palestinian. The IDF said on Twitter that “two terrorists were neutralised” during an attempted attack on Israeli troops guarding the Tapuah Junction. But the IDF’s Army Radio later reported the soldiers had opened fire after mistaking an object being held by one of the men for a weapon. “The soldiers at the checkpoint at Tapuah Junction were a little too alert, a week after the attack on the spot –they thought they saw a gun – and fired,” the IDF told Army Radio. No weapons were found in the vehicle, it said, adding the incident was under investigation. Mr Daraghmeh's funeral was held as tensions between Israel and the Palestinians continued to climb after a night of rocket attacks and air strikes. Israel’s security forces are bracing for continued unrest. Israeli Prime Minister Benjamin Netanyahu declared a state of emergency in the city of Lod, home to both Arabs and Jews, where police reported widespread rioting. Meanwhile, protesters clashed with Israeli police and attacked Jewish motorists in several Jewish-Arab towns. The bloodshed was triggered by clashes at the weekend at Jerusalem's Al Aqsa mosque, sacred to both Muslims and Jews. Israeli police stormed the compound and used tear gas and stun grenades on worshippers as they gathered for Friday prayers. In the ensuing escalation, which was also fuelled by Israeli threats to evict Palestinian families from the Sheikh Jarrah neighbourhood in East Jerusalem, militant groups fired more than 1,000 rockets at Israeli towns, causing six deaths. At least 56 Palestinians, including 14 children, have been killed in retaliatory air strikes targeting Gaza and the occupied West Bank.