The five died in four separate clashes spread across two districts bordering Pakistan-administered Kashmir on Wednesday.
An army spokesman said the dead were "Islamic militants" encountered during cordon and search operations.
The strike closed government offices, schools and many shops in Kashmir.
Traffic was light on Srinagar's roads and Indian paramilitary troops were out in force.
"The strike is to protest the brutal killings of three innocent boys," said separatist leader Sayed Ali Jeelani, who called for the protest.
The stoppage came after police in Indian-administered Kashmir intercepted a car packed with explosives on Tuesday night, Indian officials said.
Officials said some 100kg of explosives was stuffed in the vehicle that was stopped at a checkpoint near Mazihama, 20km north of the summer capital Srinagar.
The driver, identified as a member of the Hizbul Mujahidin group, was arrested, said police officer Javed Maqdoomi.
Two other suspects escaped.
"The strike is to protest the brutal killings of three innocent boys"
Sayed Ali Jeelani,
"This is the first time such a powerful IED (improvised explosive device) fitted to a car has been recovered," said Maqdoomi. "Its impact could have caused devastation if detonated."
Police intensified searches after a car bomb exploded near a Srinagar school on Wednesday last week, killing four Indian soldiers and a civilian.
Tensions have run high in Indian-administered Kashmir since the killing of three of four boys who the army said fell into an ambush near Bangargund village in the early hours of Sunday.
The surviving teenager is in critical condition.
The surrounding Kupwara district has been strike-bound since the killing and violent protests have continued.
Several hundred people demonstrated in Kupwara on Wednesday and thousands on previous days, witnesses said.
The protesters were defying an official ban on gatherings of more than four people.
The Indian Army has apologised for the killings of the boys and an official inquiry is being held.
Rights groups often accuse Indian troops of human rights violations, including shooting innocent civilians.
Indian authorities say they investigate all complaints and punish those found guilty.