Israeli troops also shot dead a "suspicious" Palestinian in the West Bank who ignored orders to stop, according to military sources.

The deaths raised to 42 the number of Palestinians killed this week, most in Israeli military raids into Gaza prompted by cross-border rocket attacks by the Islamic militant group Hamas.

"We hold Israel fully responsible for this escalation," senior Palestinian negotiator Saeb Erekat told Reuters.

On the political front, Israel's center-left Labor Party said it was pulling out of talks on forming a coalition after Prime Minister Sharon signed a coalition deal with the pro-settlement National Religious Party (NRP).

The decision dashed Sharon's hopes of forming a unity government to try to provide much-needed economic stability to Israel, which has been shaken by a 29-month-old Palestinian uprising for statehood.

Israeli armored columns backed by helicopter gunships rumbled into the northern Gaza Strip town of Beit Hanoun shortly after midnight on Sunday, battling gunmen, destroying the homes of six Islamic militants and tearing up roads.

Palestinian sources said six Palestinians were killed in Beit Hanoun, including four gunmen and members of the Palestinian security forces and one stonethrower.

A seventh Palestinian, armed with an AK-47 assault rifle and hand grenades, was killed during an attempt to infiltrate the Jewish settlement of Netzarim in central Gaza, the army said.

In Khan Younis refugee camp to the south, a Palestinian gunman shot dead a soldier at a nearby base, the army said.

Troops later killed a 15-year-old in a Khan Younis playground, Palestinian medical officials and witnesses said. Military sources said troops fired after being shot at.

On Sunday, Hamas fired three of its makeshift "Qassam" rockets from northern Gaza toward the Israeli town of Sderot. A police spokesman said at least one rocket struck inside the town, causing no casualties.

Hamas, which has stepped up Qassam launches over the past week, claimed Sunday's salvo. Israel's cabinet declared Sderot a "confrontation-line" community warranting special investment and benefits, like towns on the tinderbox border with Lebanon.

At least 1,870 Palestinians and 706 Israelis have been killed since the uprising began in September 2000 after peace talks stalled.

Labor Turns Back on Sharon

The Labor Party said on Sunday it had found no common ground with Sharon over peacemaking with the Palestinians and saw no reason to pursue negotiations to join the governing coalition Sharon is trying to form after winning a January 28 general election.

"The contacts are over," said On Levy, a spokesman for Labor chairman Amram Mitzna.

Sharon's right-wing Likud party was due to hold more coalition talks with the centrist Shinui party. Partnership with the NRP and Shinui would give Sharon control of 61 seats in the 120-member parliament.

On the West Bank's boundary with Israel, troops shot dead a Palestinian who military sources said acted suspiciously and ignored orders to stop. Palestinian medical officials said the man was probably a construction laborer heading home from work. In Beit Hanoun, soldiers carried out house-to-house searches and arrested several suspected militants, the army said. Bulldozers also piled up sand and asphalt at the town entrance to block off traffic, according to Palestinian witnesses.

Residents said troops blew up houses belonging to five Hamas militants and one Islamic Jihad member. The army said it was a message to militants that their "deeds have a price."

Troops detained a Palestinian cameraman filming the scene for Reuters, drawing a written protest from an international media organization demanding his immediate release.

The Israeli army said it suspected the journalist, Ahmed al-Khatib, 34, was involved in "terrorist activities." Soldiers led him away after inspecting his identity papers.

The army launched its current offensive against militants in the Gaza Strip and the West Bank city of Nablus after Hamas killed four tank crewmen in a bomb attack earlier this month.

Despite the violence, Palestinian leaders called for militant groups to honor a one-year cease-fire as part of Egyptian-brokered negotiations between Palestinian nationalist and Islamic factions which have so far borne little fruit.

Mahmoud Abbas, secretary-general of the PLO's Executive Committee, wrote in the Palestinian newspaper Al-Ayyam that he expected the Cairo talks to resume, possibly next week.

(China Daily February 24, 2003)