Gaza civilians suffer as Israel troops tighten grip

By Nidal al-Mughrabi

GAZA (Reuters) - Israeli troops and tanks split the Gaza Strip and ringed its main city on Sunday in an offensive against Hamas that has killed 500 Palestinians, including a growing number of civilians.

Israeli tanks poured shells and machinegun-fire into suspected militant positions and war planes struck as Hamas fighters fought back with mortars and rockets.

Hamas kept up rocket attacks against southern Israel, defying efforts by the Middle East's most powerful army to achieve Israeli leaders' declared aim of removing the threat of cross-border salvoes.

Israeli Prime Minister Ehud Olmert told French President Nicolas Sarkozy in a phone call that Israel would continue to allow in aid supplies to prevent a humanitarian crisis in Gaza. Sarkozy arrives in Jerusalem on Monday to push for a truce.

European Union foreign policy chiefs launched a mission to seek a ceasefire in the Hamas-run Gaza Strip but acknowledged they faced a difficult task.

Israeli President Shimon Peres rejected the possibility of a ceasefire but said Israel did not intend to occupy Gaza.

"We shall not accept the idea that Hamas will continue to fire and we shall declare a ceasefire. It does not make any sense," Peres told U.S. broadcaster ABC.

At least 42 Palestinians, most of them civilians, were killed on Sunday as Israeli shells slammed into houses and Gaza's main shopping district, medical sources said.

Israel has accused Hamas of using civilians in the Gaza Strip as "human shields," saying the Islamist group has been firing rockets at Israel from densely populated areas and storing weapons in homes and mosques.

A foreign Red Crescent doctor said: "Civilians are being killed ... shells are severing people's legs, shrapnel is going into people's bodies and into people's homes, a lot of people are being cut down. Everyone is terrified."

Medics said three Palestinian rescue workers were killed by Israeli fire on Sunday, raising to seven the total number of medical staff who have died in nine days of bloodshed.

The Saturday night invasion of the Hamas-ruled Gaza Strip followed a week of Israeli bombardments from land, sea and air -- the most serious Israeli-Palestinian fighting in decades.

Palestinians said soldiers moved deep into Beit Lahiya in the northern Gaza Strip and asked residents to leave their homes to avoid being hurt in the fighting. Some families sought refuge in U.N.-run schools in neighboring Beit Hanoun.

Gaza medical officials said the total Palestinian death toll in Israel's "Operation Cast Lead" rose to 512. A U.N. agency said at least a quarter of the dead were civilians. A Palestinian human rights group put the figure at 40 percent.

One Israeli soldier was killed and 32 were wounded in the ground offensive, Israel said. Four Israelis have been killed by the Hamas rocket strikes since December 27.