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"We warn against such a move and call on the Palestinian people to revive the intifada if these unjust decisions on Jerusalem are adopted," Hamas said in a statement.
Any decision to move its embassy there would be "a flagrant attack on the city by the American administration" and give Israel "a cover for continuing its crime of Judaising the city and emptying it of Palestinians," the leader said.
Trump's move ends seven decades of US ambiguity on the status of the Holy City, which is vociferously claimed by both Israelis and Palestinians, and his decision immediately caused a stir with US allies who condemned the move.
Saudi Arabia blasted the move as "unjustified and irresponsible", and said it goes against the "historical and permanent rights of the Palestinian people."
Through gritted teeth, Britain described the move as "unhelpful" and France called it "regrettable." Germany said plainly that it "does not support" Trump's decision.
Eight countries including Britain, France and Italy pressed for an emergency meeting of the UN Security Council in response to the move, which was set for Friday.
The leaders of Muslim nations meanwhile deployed ever-harsher rhetoric to describe Trump's decision.
Turkey and Iran, both vying for regional influence, tried to give voice to the anger felt by many across the Muslim world.
Ankara called the decision "irresponsible" and illegal. Tehran said it would "provoke Muslims and inflame a new intifada."