By Ali Sawafta and Noah Browning

RAMALLAH, West Bank (Reuters) - Israeli troops shot dead three Palestinians during an early morning raid to arrest a suspected militant in the West Bank on Monday, hours before negotiators met for another round of peace talks, Palestinian sources said.

The U. S.-brokered talks resumed last month after a three-year stalemate over Israeli settlement expansion in the West Bank and East Jerusalem, areas Israel captured in 1967 which Palestinians seek for a state along with the Gaza Strip.

Neither party has expressed much optimism for a major breakthrough and the negotiators have met largely in secret, alternating between Israeli and Palestinian locations. No details were revealed on the talks.

Witnesses said Israeli armored jeeps entered the Qalandiya refugee camp, near Jerusalem, at around 3 a.m. (8.00 p.m. EDT) and were met by stone-throwing residents. The Israeli forces responded with gunfire and left the camp around daybreak, the witnesses added.

Hospital officials told Reuters three men were shot dead.

An Israeli police spokesman said a clash erupted when border police carrying out an arrest raid were confronted by Palestinians who threw firebombs and rocks at them. The incident was being investigated, spokesman Micky Rosenfeld said.

Israeli forces arrested a local man who had previously served a nine-year prison sentence for alleged militant activity, residents said. About a dozen protesters were wounded in the clash, they added.

Israeli troops often enter Palestinian-controlled territory to detain people suspected of planning attacks, usually conducting the raids during darkness to minimize confrontation.

GUNFIRE AT FUNERALS

Thousands of residents of the tightly-packed camp, later carried the three men's bodies, draped in Palestinian flags with their heads wrapped in traditional black and white chequered scarves, in a funeral procession that wound its way through its narrow alleyways.

Around ten masked Palestinian militants discharged their automatic weapons into the air in salute.

After the funeral, dozens of local youths threw stones towards Israeli soldiers at the Qalandiya checkpoint, a main crossing between the West Bank and Jerusalem, and they were met with volleys of tear gas and rubber bullets.

Nabil Abu Rdaineh, a spokesman for Palestinian President Mahmoud Abbas, described the killings as "assassinations".

"The series of Israel crimes and new settlement tenders constitute a clear message on the real Israeli intentions towards the peace process, and there will be negative consequences to these actions," he said in a statement.

Violence in the West Bank has worsened since the beginning of 2013.

With Monday's deaths, Israeli forces have killed 14 Palestinians there this year, most of them in clashes, compared with three fatalities in the same period in 2012, according to United Nations figures.

(Additional reporting by Ari Rabinovitch in Jerusalem; Editing by Ori Lewis and Jeffrey Heller)

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