CAIRO — Egypt's powerful Muslim Brotherhood called nationwide demonstrations Sunday in support of Islamist President Mohamed Morsi in his showdown with the judges over the path to a new constitution.

The show of strength on the streets by the president's supporters had the potential for triggering clashes with opponents of the sweeping new powers he assumed on Thursday who remained camped out in Cairo's Tahrir Square.

Share prices on the Egypt Exchange plunged almost 9.5 percent by midday (1000 GMT) in the face of the deepening political crisis.

The main EGX-30 index shed 9.49 percent to reach 4,923.19 points, according to the Egyptian Exchange, with trading suspended for half an hour due to intense investor selling.

Before dawn, the hardcore of liberal activists who spent the night in the iconic protest hub fought off an attempt by Morsi supporters to burn down the 30 or so tents they had erected in the square, witnesses said.

The US embassy warned Americans to avoid all places where demonstrations were likely to be held as Western concern mounted over the potential of Morsi's power grab to spark new violence in the Arab world's most populous state.

A Brotherhood statement called on its well-organised supporters to hold demonstrations after afternoon Muslim prayers in all of Egypt's main cities to "support the decisions of the president."

The Brotherhood's political arm insists that the president's decree placing his decisions beyond judicial review was a necessary move to prevent the courts disbanding the Islamist-dominated panel drawing up a new constitution as they have already the Islamist-dominated lower house of parliament.

A ruling that had been due from the highest court next month would have had the potential to prolong an already turbulent transition from veteran strongman Hosni Mubarak's rule since his overthrow in a popular uprising early last year, the Freedom and Justice Party said.

But the judges hit back denouncing "an unprecedented attack on the independence of the judiciary and its rulings" and calling for the courts to stop work nationwide.

Judges in two of the country's 27 provinces, including Mediterranean metropolis Alexandria, heeded the strike call Sunday while those in the rest were meeting to decide their response, the Judges Club said.

Tahrir Square, one of the capital's main road junctions, remained closed to traffic on Sunday as Morsi opponents pressed their sit-in.

The protesters have the backing of all of Egypt's leading secular politicians.

Former UN nuclear watchdog chief Mohamed ElBaradei, and former presidential candidates Hamdeen Sabbahi, Amr Mussa and Abdelmoneim Abul Futuh, said in a joint statement on Saturday that they would have no dialogue with Morsi until he rescinded his decree.

Anti-riot police began erecting a concrete barrier to keep the Tahrir protesters away from nearby government buildings, witnesses said, adding that they made a string of arrests in streets surrounding the square.

The US embassy said it had advised its staff to avoid the city centre "to the extent possible until further notice."

"As a matter of general practice, US citizens should avoid areas where large gatherings may occur," it added in a security notice on its website.

"Even demonstrations or events intended to be peaceful can turn confrontational and possibly escalate into violence."

The Muslim Brotherhood has also called a "million man" demonstration for Tuesday on Abdeen Square, not far from Tahrir.

Washington, which only Wednesday voiced fulsome praise for Morsi's role in brokering a truce between Israel and Gaza's Hamas rulers to end eight days of deadly violence, has led international criticism of his power grab.

"The decisions and declarations announced on November 22 raise concerns for many Egyptians and for the international community," US State Department spokeswoman Victoria Nuland said on Friday.

"One of the aspirations of the revolution was to ensure that power would not be overly concentrated in the hands of any one person or institution," she added.