Russian forces have struck a market in the city of Sloviansk in eastern Ukraine, killing at least two people and injuring seven, according to officials. 

Yellow smoke billowed up from an auto supplies shop, and flames engulfed rows of market stalls as firefighters tried to extinguish the blaze.

It was not immediately clear what munitions had been used in the attack on the frontline city in the Donetsk region, or how many people had been at the market when it was hit.

"Russians again deliberately target areas where civilians congregate," Donetsk regional governor Pavlo Kyrylenko wrote in a Facebook post.

"This is sheer terrorism."

Police said the market had been closing for the day, but that some shops had still been open.

In a residential neighbourhood on another side of the city, several houses were damaged and firefighters were tackling flames in a burning house where a missile hit.

Rescue workers said at least two people had been taken to hospital from that strike.

A bloodied Yuri Sherbako, 53, his face and leg patched up with bandages, said he was taking a break from repairing a roof when the shelling began.

"I dived between these two buildings to survive," he said, pointing to two houses that had been largely destroyed and were still smouldering.

Sloviansk Mayor Vadym Lyakh said on Facebook that the city had come under mass shelling in the centre and north and urged residents to stay in shelters.

The attack happened on the eighth anniversary of Ukraine recapturing Sloviansk from Russian proxy forces of the self-proclaimed Donetsk People's Republic.

Russia has secured almost complete control of the neighbouring Luhansk region and is turning its attention to Sloviansk as a gateway to capture the rest of the area.

It has fired several missile salvos into Sloviansk in recent days.

"Sloviansk and Kramatorsk came under shelling. They are now also the main line of assault for the enemy," said Mr Kyrylenko.

Military spokesman Oleksandr Motuzyanyk told a briefing that Russian forces were focussing their efforts on the Luhansk and Donetsk regions, firing artillery along the entire front line.

He said Ukraine's army was trying to prevent Russia from creating conditions to launch an assault on Sloviansk.

Russian separatists seize foreign ships off Mariupol

Russian-backed separatists have seized two foreign-flagged ships in the eastern Ukrainian port city of Mariupol, saying they are now "state property", in the first such moves against commercial shipping.

Mariupol, on Ukraine's southern coast, fell under the control of Russian and separatist forces in May after a months-long siege. 

The self-proclaimed Donetsk People's Republic, via its Foreign Ministry, informed two shipping companies that their vessels were the subject of "forcible appropriation of movable property with forced conversion into state property", without any compensation to the owners, according to two separate letters.

Donetsk officials did not immediately respond to an emailed request for comment, while others could not be reached by phone.

Liberia registered Smarta Shipping, the owner of the Liberia-flagged Smarta bulk vessel, one of the two vessels taken, said it was informed of the seizure by email on June 30, calling it unlawful and "against all norms of international law".

"Such forced appropriation is in breach of fundamental human rights in so far as property rights are concerned," the company said in a statement.

"Such action is a serious threat to shipping and to maritime safety."

The company said the Smarta arrived in Mariupol on February 21 to load a steel cargo and was hit by shelling on March 20 that seriously damaged its bridge.

It said the 19-member crew had been forcibly taken by the Russian military to Donetsk and released a month later.

The other vessel seized was the Panama-flagged Blue Star I, according to the letter.

An official with the vessel's Odesa-based manager Fetida Maritime declined to comment, adding that Ukraine's security service had all the information.

A Ukrainian Foreign Ministry official said it was aware of an announcement by "the Russian occupation authority in Donetsk to create a 'national fleet' comprised of ships they had stolen in Mariupol".

A spokesperson with the UN shipping agency, the International Maritime Organization (IMO), said it was "aware of at least one ship departing from Mariupol, however little else has changed". 

Over 80 foreign-flagged ships remain stuck in Ukrainian ports, IMO data showed.

Some of those terminals remain under Russian control. 

Retaking territories captured by Russia

British Prime Minister Boris Johnson told President Volodymyr Zelenskyy during a call that he believed Ukraine's military could retake territory recently captured by Russian forces.

Mr Johnson updated Mr Zelenskyy on the latest deliveries of British military equipment, including 10 self-propelled artillery systems and loitering munitions, which would be arriving in the coming days and weeks, a spokesperson said.

Mr Zelenskyy's adviser Oleksiy Arestovych said Russia took 90 days and paid a steep price to capture two medium-sized cities.

"This is the last victory for Russia on Ukrainian territory," Mr Arestovych said in a video posted online.

He said besides the battle for Donetsk, Ukraine was hoping to launch counter offensives in the south of the country.

Russia might struggle to redirect its forces there with 60 per cent of them now concentrated in the east, he said.

"And there are no more forces that can be brought in from Russia. They paid a big price for Sievierodonetsk and Lysychansk."

Mr Zelenskyy said that despite Ukraine's withdrawal from Lysychansk, its troops continued to fight.

"The armed forces of Ukraine respond, push back and destroy the offensive potential of the occupiers day after day," Mr Zelenskyy said in a nightly video message.

"We need to break them. It is a difficult task. It requires time and superhuman efforts. But we have no alternative."

Reuters