The air strikes, which killed 35 civilians on Saturday, including 15 children, were meant to punish the Lebanese government for failing to disarm the resistance group Hezbollah.
Israel says this has allowed Hezbollah to menace Israel's northern border, where measures just short of a state of emergency have been ordered.
Israel has said it aims not just to force Hezbollah to free the soldiers, whom the Shia group wants to trade for prisoners in Israel, but to destroy its ability to fire rockets into Israel.
The bombing of Lebanese roads, bridges, ports and airports, as well as Hezbollah targets, is Israel's most destructive onslaught since an invasion to expel Palestinian forces in 1982.
The attacks started after Hezbollah captured two Israeli soldiers in a cross-border operation on Wednesday.
Air strikes in the early hours of Sunday damaged a flyover linking the southern suburb with the eastern part of Beirut, Hezbollah's al-Manar television reported, and the loud blasts were heard throughout the capital. Israeli aircraft have already flattened Hezbollah's nine-storey headquarters.
The campaign in Lebanon coincided with an offensive Israel started in the Gaza Strip on June 28 to try to retrieve another captured soldier and halt Palestinian rocket fire.
Israeli forces clashed with fighters in Gaza on Sunday as tanks moved back into the north of the Gaza Strip. Tanks and armoured personnel carriers, backed by helicopter gunships, moved into farmland near Beit Hanoun, an area often used by fighters for launching rockets.
Small groups of fighters opened fire at the Israeli forces, but there was no report of casualties.
Appeals for aid
Fouad Siniora, the Lebanese prime minister, repeated his demands for an immediate UN-backed ceasefire on Saturday. He denounced Israel for turning his country into a "disaster zone" and appealed for foreign aid.
Siniora (L) blamed Israel for turning
Lebanon into a disaster zone
His speech came hours after Israel bombarded ports in Christian areas for the first time and a helicopter missile hit a lighthouse on Beirut's seafront.
Israel has said the way out will be for Lebanon to implement a UN resolution demanding that Hezbollah be disarmed. The Beirut government, led by an anti-Syrian coalition, lacks the unity and firepower to disarm Hezbollah, the only Lebanese faction to keep its guns after the 1975-90 civil war.
George Bush, the US president, who has declined to urge Israel to curb its military operations, said Syria should tell Hezbollah, also backed by Iran, to stop cross-border attacks.
Meanwhile, an Israeli missile incinerated a van in southern Lebanon, killing 20 people, among them 15 children, in the deadliest single attack of the campaign.
Police said the van was carrying two families fleeing the village of Marwaheen after Israeli loudspeaker warnings to leave their homes.
At least 104 people, all but four of them civilians, have been killed in the five-day assault, which has choked Lebanon's economy and forced tourists and foreigners to flee.
Four Israelis, including a five-year-old child, have been killed and 300 wounded by about 700 rockets fired since Wednesday at more than 20 towns.
The Israeli offensive has forced hundreds of families to flee their homes in south Lebanon and Beirut's southern suburb, and they are sheltering in schools across the capital. Human rights activists said the makeshift shelters lacked basic services.
The offensive has forced
families to flee their homes
"They don't have enough blankets and medical supplies," Ghassan Makarem, one activist, told Reuters on Sunday. "The situation is disgusting."
The Israeli government gave authorities the power to shut schools, factories and public institutions in the north in a move that falls just short of a full state of emergency.
Israel has deployed Patriot missile batteries in the northern city of Haifa to intercept rockets.
It also warned the Lebanese army on Sunday against shooting at its aircraft and said it would not hesitate to strike "at any party operating against it".
Israel says it aims not just to force Hezbollah to free the soldiers, whom the Shia group wants to trade for prisoners in Israel, but to destroy its ability to fire rockets into Israel.