Israel, Hamas hold fire in Gaza

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JERUSALEM, Mar 11 (AFP): Israel and Hamas held their fire around the Gaza Strip Monday as Egypt worked to broker a comprehensive deal to end violence and lift the blockade of the impoverished Palestinian territory.
Palestinians said the two sides have made headway towards a truce, but Israel, while stressing the army would not hit Gaza if militants stopped firing rockets, insisted it was not negotiating a ceasefire.
For a third day in a row, the Israeli army did not strike the Hamas-run territory and said Gaza fighters had all but halted their barrages, launching just one rocket and one mortar round since Sunday.
More than 130 Palestinians were killed in a broad Israeli offensive launched in late February to stop the rocket fire, raising concerns about the future of already faltering peace talks.
But efforts to bring about a ceasefire have gathered pace, with senior US and Israeli envoys holding talks in Egypt over the past week, as have delegations from Hamas and Islamic Jihad.
"With the developments in Egypt, I think there is an agreement in principle on that and a deal might be reached in the coming few days," said Palestinian president Mahmud Abbas.
But Prime Minister Ehud Olmert insisted "there is no deal, there are no negotiations, either direct or indirect."
"If the terror stops, if the Qassams stop landing ... Israel will have no reason to fight the terror organisations there... We will have no reason to retaliate," he said at a news conference.
His comments contradicted statements from Egypt and Palestinian officials that Cairo, supported by the United States, has been working on a deal.
"For the moment, we are at a preliminary stage over this; we are listening to all the parties so as to be able then to draw up a detailed and comprehensive initiative," said Mohammed Bassiuni, chairman of the Egyptian parliament's national security committee.
Bassiuni, a former ambassador to Israel, told the news agency the initiative would likely call for a "period of calm," an end of the Israeli blockade of Gaza and an exchange of prisoners between Israel and Hamas.
Hamas also said it was working with the Egyptians -- who have often played the role of Middle East mediator.