Fresh clashes have broken out in Hong Kong as riot police use batons and pepper spray on pro-democracy demonstrators.

With the protest movement entering its seventh night, tens of thousands of people gathered for a peace rally in the downtown Admiralty district near the government headquarters chanting “Peace! Anti-violence!” and singing democracy anthems.

But across the harbour in the city’s densely packed Mong Kok district tensions flared anew early on Sunday, as crowds of baying protesters surrounded police, accusing them of co-operating with gangsters, according local sources.

Police have responded with pepper spray.

Pro-democracy protesters have taken to Hong Kong’s streets all week to demand the right to nominate who can run as their next leader in 2017 elections. Beijing insists only candidates it has approved will be able to stand.

Student leaders said early on Sunday that they would meet the government if certain conditions were met, having scrapped planned negotiations the previous day over anger at police actions in earlier clashes.

In Mong Kok, a working-class district of shops and residences that was also the site of ugly scenes on Friday, furious protesters claimed anti-democracy agitators from the city’s triad mobs were being arrested – only to be released back into the crowds again.

“The police have been co-operating with gangsters,” said David Chan, a 22-year-old student.

“We have witnessed the police letting go of the gangsters. That’s why the peaceful protesters are so angry, we have no trust in them any more.”

Two of the city’s busiest shopping districts descended into chaos on Friday as opponents, some of them waving Chinese flags, clashed with protesters, tearing down their tents and barricades.

The incidents led to accusations that the police failed to protect the demonstrators from the opposing crowds and speculation authorities had hired paid thugs to break up the protests.

China has accused democracy campaigners of destabilising the regional financial hub.

The People’s Daily newspaper, a Communist Party mouthpiece, said in an editorial on Saturday that the protesters were “day-dreaming” over the prospect of change.

Small rallies by crowds sporting blue ribbons were held by people who said they supported the police and the government, in a growing sign of a backlash against a campaign that has caused wide-scale disruption and taken a heavy toll on local businesses.

In a speech broadcast on television, Hong Kong’s reviled leader said he was determined to clear the streets of protesters by Monday when the city returns to work.

“The government and the police have the duty and determination to take all necessary actions to restore social order so that the government and some seven million people of Hong Kong can return to their normal work and life,” Chief Executive Leung Chun-ying said.

Fears of intimidation have replaced the festive sense of unity that had prevailed for days.