Palestinian girl, Israeli killed in fighting

An Israeli missile aimed at a group of militants struck a house in the Gaza Strip on Thursday and killed a 6-year-old Palestinian girl, Palestinian officials said, hours after an Israeli was killed by a Hamas mortar barrage fired from the area, the AP reported.

The sudden spike in violence dealt a new setback to Egyptian efforts to mediate a truce between Israel and Gaza's Hamas rulers, and raised the likelihood of a tough Israeli military reprisal.

The Israeli army confirmed the aerial attack and said it had hit a "gunman."

But Hamas security officials said the missile missed a group of militants and struck a nearby house. The Palestinian girl, who was playing outside, was killed and her mother was wounded, said Dr. Moaiya Hassanain of the Palestinian Health Ministry.

The airstrike came shortly after Gaza's Hamas rulers claimed responsibility for the deadly mortar attack in southern Israel. The mortar shells were fired from the same area targeted in the airstrike, the army said.

Israeli government spokesman David Baker said Hamas "will be held accountable" for the mortar attack. Israeli defense officials were set to discuss a response at a meeting Sunday after Prime Minister Ehud Olmert returns from the U.S.

Asked by reporters accompanying him in Washington if the time had come for a large-scale Israeli ground offensive into Gaza, Olmert was noncommittal.

"We are not eager for a military operation," he said. "But we are not shying away from one."

In Jerusalem, the Israeli Foreign Ministry said the mortar shells hit a paint factory at the Nir Oz communal farm, killing a 52-year-old man and wounding four other people.

Hamas, the Islamic militant group that has ruled Gaza for the past year, said it had fired three mortar shells "as a response to the nonstop aggression against our people."

Israel frequently conducts airstrikes and ground incursions in Gaza in response to Palestinian rocket and mortar fire. But the area has been largely quiet in recent weeks as Egypt works to wrap up a truce agreement.

Olmert is expected to convene his Security Cabinet, a gathering of senior government ministers and defense officials, on Sunday to discuss the ongoing violence in Gaza, Israeli defense officials said.

The officials said the Security Cabinet would consider voting on the cease-fire proposal, or alternatively discuss whether to step up military action in Gaza. The officials, speaking on condition of anonymity under military guidelines, said most members of the Security Cabinet oppose the cease-fire at the current time.

Defense Minister Ehud Barak has repeatedly warned that a large-scale military operation in Gaza is likely, despite the Egyptian cease-fire efforts.

Israel fears that Hamas will use the lull to rearm and has demanded that any agreement include assurances that Hamas halt arms smuggling across its border with Egypt. Israel also wants Hamas to release an Israeli soldier who has been held captive in Gaza for nearly two years.

Hamas, meanwhile, wants a cease-fire to include a large-scale release of Palestinian prisoners held by Israel and an end to Israel's yearlong economic blockade of Gaza.

Israel sealed Gaza's borders and imposed other economic sanctions after the Hamas takeover of Gaza last year, and tightened the restrictions after a sharp increase in rocket fire several months ago. The sanctions have caused widespread shortages of fuel, electricity and many basic goods in Gaza.

Israeli officials say the blockade will be eased only at a later stage if there is a halt to the rocket attacks.

Palestinian militants have fired thousands of rockets and mortar shells into Israel since Hamas violently took control of Gaza last year. The attacks have killed 16 people in Israel since late 2001.

While Israel battles Hamas in Gaza, it has been conducting peace talks with the rival Palestinian government of moderate President Mahmoud Abbas, based in the West Bank. Abbas expelled Hamas from the Palestinian government after Hamas violently seized control of Gaza in June 2007.

Abbas has refused to speak to the group until it cedes control of Gaza. But in an apparent about-face, Abbas called Wednesday for new dialogue with Hamas.

Hamas' prime minister, Ismail Haniyeh, welcomed the gesture. "We have to encourage the people. We have to dry their wounds. We have to clean their tears and to heal their pain," he said in a speech in Gaza City on Thursday.

Abbas gave no details about his proposal, including whether he had dropped his preconditions.

If Abbas were to start negotiating with Hamas, he could jeopardize the broad international support that he gained after the Hamas takeover. Israel has previously threatened to cut off peace talks if Abbas takes the Islamic militants back into his government. The U.S., Israel and the EU consider Hamas a terrorist group.

But Abbas has grown increasingly frustrated with the slow pace of talks with Israel. Earlier Wednesday, Abbas' chief negotiator said it would take "a miracle" to meet the year-end target for a deal set by President Bush.

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