SANA'A--President Ali Abdullah Saleh said on Friday that the National Defence Council had declared a state of emergency in Yemen. Earlier on Friday, police opened fire on hundreds of thousands of anti-government protesters killing at least 50 people and wounding 240 in the capital, Sana'a. Security men in civilian clothes fired live bullets at the protesters from rooftops, aiming at the head and chest, media sources said. Yemeni security forces and pro-government gunmen opened fire at a protest in Sana'a during afternoon prayers on Friday, reports and witnesses said. A doctor said the death toll may rise further. Gunfire broke out when security forces tried to prevent anti-government worshippers from marching after prayers near the protest base at Sana'a University, and plumes of smoke from burning tires filled the air. Tens of thousands of Yemenis had gathered in Sana'a for prayers and protests as businessmen floated a proposal to end a standoff between Saleh and protesters demanding he step down immediately. Yemen, next door to top oil exporter Saudi Arabia, has been rocked by weeks of demonstrations that have undermined Saleh's grip on power. Tens of thousands of protesters were also gathered in cities across Yemen, from the southern port city of Aden to Hodeida in the west. The United States, which has long seen Saleh as a bulwark against a dynamic Al Qaida wing based in Yemen, has condemned the bloodshed and backed the right for peaceful protest, but has insisted only dialogue can end the political crisis. Saleh has promised to step down in 2013 and offered a new constitution giving more powers to parliament, but he has refused his critics' main demand to quit immediately. A string of Saleh's allies have recently defected to the protesters, who are frustrated by rampant corruption and soaring unemployment. Some 40 per cent of the population live on $2 a day or less in Yemen, and a third face chronic hunger.