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imageDONETSK: Retreating pro-Russian insurgents dug in on Monday in Ukraine's sprawling industrial hub of Donetsk after government forces scored a string of morale-boosting victories in the bloody battle for the future of the ex-Soviet state.

The eastern home of one million mostly Russian speakers has been flooded with convoys carrying hundreds of fighters and scores of anti-aircraft guns from five smaller surrounding cities where Ukrainian flags were flying for the first time in three months.

The rebels erected checkpoints along the main roads leading into Donetsk while the centre of the riverbank city itself saw several restaurants and shops shutter their doors.

And two rail bridges were blown up just north and east of the city adding to another link damaged on Friday as part of a seeming campaign to help barricade Donetsk. Pictures showed a cargo train balancing perilously over a highway and one of the broken spans sagging under its weight.

The separatists' "tactical retreat" began on Saturday with the fall of their symbolic bastion Slavyansk and continued until government forces had reached the very gates of the region's main metropolis.

Ukrainian National Security and Defence Council deputy head Mykhailo Koval said on Monday that soldiers now intended to complete a "full blockade" of Donetsk and the neighbouring stronghold of Lugansk both capitals of their own "People's Republics".

Koval said their containment would be followed by "corresponding measures that will force the separatists, the bandits to lay down their arms".

His carefully-worded comments underscored the dilemma facing Western-backed President Petro Poroshenko as he seeks to fulful his May 25 election promise to quickly end Ukraine's worst crisis since independence in 1991.

The conflict has claimed the lives of nearly 500 people and displaced tens of thousands across an economically-vital region that has long viewed the more nationalistic west of Ukraine and Kiev with a mixture of hostility and mistrust.

A shelling campaign of either Donetsk or Lugansk of the type that pulverised parts of Slavyansk would seem unimaginable because of both the inevitable toll and the high probability of an already-fuming Kremlin responding by sending in its troops.

It would also risk throwing the strategic nation of some 45 million into an all-out civil war on the European Union's eastern frontier that would pit Russia against Western powers in a standoff of a scale not even witnessed during the Cold War.

But the rebels have shown few signs of being ready to either sue for peace or engage Kiev in contacts that could lead to a political settlement now being promoted urgently by Germany and France.

French President Francois Hollande and US President Barack Obama, after holding telephone talks on Monday, urged their Russian counterpart Vladimir Putin "to pressure the separatists so that they agree to a dialogue with the Ukrainian authorities" with a view to reaching a bilateral ceasefire.

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