Clashes in Cairo after Mursi seizes new powers

CAIRO (Reuters) - Angry youths hurled rocks at security forces and burned a police truck as thousands gathered in central Cairo to protest at Egyptian President Mohamed Mursi's decision to grab sweeping new powers.

Police fired tear gas near Tahrir Square, heart of the 2011 uprising that toppled Hosni Mubarak at the height of the Arab Spring. Thousands demanded that Mursi should quit and accused him of launching a "coup".

There were also violent protests in Alexandria, Port Said and Suez.

Mursi on Thursday issued a decree that puts his decisions beyond any legal challenge until a new parliament is elected. Opponents immediately accused him of turning into a new Mubarak and hijacking the Egyptian revolution.

"This is the point of no return for Mursi. He has dug himself deeper in a hole and won't know how to get out of it," said Ahmed Saleh, an activist who said many would stay in Tahrir square until Mursi withdrew the decree.

"The people want to bring down the regime," shouted protesters in Tahrir, echoing a chant used in the uprising that forced Mubarak to step down.

The United States, the European Union and the United Nations expressed concern at Mursi's move.

Mursi's rivals condemned him as an autocratic pharaoh who wanted to impose his Islamist vision on Egypt.

The president's aides said the decree was intended to speed up a protracted transition to democracy that has been hindered by legal obstacles

"I am for all Egyptians," Mursi said on a stage outside the presidential palace, adding that he was working for social and economic stability and remained committed to the revolution.

JUDGES MEET

Egyptian judges will meet on Saturday to respond to Mursi's move, which put him above the judicial oversight. The judges could threaten to go on strike, which would bring the judiciary to a halt.

Some non-Islamist political parties called for a million-strong march on Tuesday to demand that Mursi rescinds his decree.

But Islamist parties, including the Building and Development Party, accused Mursi's opponents of undermining the democratic process that brought him to office.

"Those calling for the downfall of President Mohamed Mursi have rejected democracy because President Mursi has been democratically elected by popular will," the party said in a statement. Mursi's decree would "save the revolution from the remnants of Mubarak's regime", it said.

Buoyed by accolades from around the world for mediating a truce between Hamas and Israel in the Gaza Strip, Mursi on Thursday ordered that an Islamist-dominated assembly writing the new constitution could not be dissolved by legal challenges.

Mursi, an Islamist whose roots are in the Muslim Brotherhood, also gave himself wide powers that allowed him to sack the unpopular public prosecutor and opened the door for a retrial for Mubarak and his aides.

TURBULENCE AND TURMOIL

The president's decree has consolidated his power but looks set to polarize Egypt further, threatening more turmoil in a nation at the heart of the Arab Spring.

In Alexandria, north of Cairo, protesters ransacked an office of the Brotherhood's political party, burning books and chairs in the street. Supporters of Mursi and opponents clashed elsewhere in the city, leaving 12 injured.

A party building was attacked by stone-throwing protesters in Port Said, and demonstrators in Suez threw petrol bombs that burned banners outside the party building.

Although Washington has praised Egypt for its part in bringing Israelis and Palestinians to a ceasefire on Wednesday, it expressed reservations about Mursi's latest move.

"The decisions and declarations announced on November 22 raise concerns for many Egyptians and for the international community," State Department spokeswoman Victoria Nuland said in a statement.

The European Union urged Mursi to respect the democratic process, while the United Nations expressed fears about human rights.

"The decree is basically a coup on state institutions and the rule of law that is likely to undermine the revolution and the transition to democracy," said Mervat Ahmed, an independent activist in Tahrir protesting against the decree.

Leading liberal Mohamed ElBaradei, who joined other politicians on Thursday night to demand the decree was withdrawn, wrote on his Twitter account that Mursi had "usurped all state powers and appointed himself Egypt's new pharaoh".

Almost two years after Mubarak was toppled and about five months since Mursi took office, Egypt has no permanent constitution, which must be in place before new parliamentary elections are held.

An assembly drawing up the constitution has yet to complete its work. Many liberals, Christians and others have walked out accusing the Islamists who dominate it of ignoring their voices over the extent that Islam should be enshrined in the new state.

(Additional reporting by Tom Miles in Geneva and Sebastian Moffett in Brussels; Editing by Giles Elgood)

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Sarkozy denies receiving money from L'Oreal heiress

BORDEAUX, France: Ex-president Nicolas Sarkozy told judges he received no money from France's richest woman, Liliane Bettencourt, a newspaper said, amid allegations that his 2007 election campaign was illegally financed.

"I have known the Bettencourts for 28 years and I am 57... They have never given me a sou (cent) and I have never asked them," Sarkozy said during a 12-hour hearing in front of investigating magistrates in the southern city of Bordeaux on Thursday, the Sud Ouest daily reported.

Sarkozy escaped indictment but will continue to be investigated over the allegations after the panel of three examining magistrates decided on Thursday to treat him as a witness under caution rather than formally charging him.

The newspaper report was the first to quote him from the written transcript of the confidential enquiry session.

The judges' decision will allow the former leader to retain hope he will eventually be exonerated of accusations he denies. But it also means the magistrates believe there are grounds for further investigation, a stance that deals a significant blow to Sarkozy's hopes of staging a political comeback.

The conviction last year of his predecessor Jacques Chirac on corruption charges related to his time as mayor of Paris demonstrated that French courts are willing to go after former leaders.

Sarkozy, was quoted as saying in his Bordeaux testimony that "in 36 years of political life, this is the first time that I have been brought before examining magistrates" and that "it's an ordeal".

Sarkozy's lawyer, Thierry Herzog, has said he hopes the judges will now leave his client in peace.

Sarkozy, who is married to former supermodel Carla Bruni, won international acclaim as the principal architect of last year's military campaign against Libyan dictator Moamer Kadhafi.

But since losing to Francois Hollande in the presidential election earlier this year, he has had to battle a string of allegations relating to his time in office and various electoral campaigns he has been involved in.

The suspicion at the centre of Thursday's interrogation is that he took financial advantage of elderly L'Oreal heiress Bettencourt when she was too frail to fully understand what she was doing.

In his comments on Thursday, the Sud Ouest reported, Sarkozy said he had noticed "no apparent sign" of mental fragility on her part.

"When I see her she was well-dressed, she doesn't slur her words. She says nothing implausible," Sarkozy was quoted as saying.

Bettencourt is now 90 and has been in poor health since 2006. Sarkozy, it is alleged, obtained significant amounts of money from her for his 2007 campaign, simultaneously breaching electoral spending limits and taking advantage of a person weakened by ill health.

Bettencourt's former accountant, Claire Thibout, told police in 2010 that she had handed envelopes stuffed with cash to Bettencourt's right-hand man, Patrice de Maistre, on the understanding it was to be passed on to Sarkozy's campaign treasurer, Eric Woerth.

Investigators suspect up to four million euros (US$5.2 million) of Bettencourt's cash subsequently made its way into Sarkozy's party coffers.

Sarkozy, who lost his immunity from prosecution after losing to Hollande, is embroiled in a string of scandals with legal repercussions.

As well as the Bettencourt case, he faces probes into contracts for opinion polls, an illegal police investigation into journalists and alleged kickbacks on a Pakistani arms deal used to finance the right in 1995, when Sarkozy was budget minister.

He has always denied any wrongdoing and has not ruled out another tilt at the presidency in 2017 amid signs that his party, the UMP, is on the point of disintegration.

A vote intended to produce a new leader for the centre-right party descended into chaos this week with ex-prime minister Francois Fillon contesting the result of a poll edged by party secretary-general Jean-Francois Cope.

With the party split down the middle, many party activists are calling for Sarkozy to return to the fray, but Thursday night's ruling suggests he might be otherwise engaged for some time to come.

- AFP/xq

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Top Jaish-e-Mohammad militant commander killed in J&K

SRINAGAR:A top Jaish-e-Mohammad militant commander was killed in an encounter with security forces in Sopore in north Kashmir's Baramullah district in the wee hours today.

Sopore Police and 22 Rashtriya Rifles cordoned Chatlora village, 55 kms from here, at around 1am after receiving information that a self-styled divisional commander of foreign origin of the outfit was hiding in a village, official sources told PTI.

At around 4am, when the security forces were conducting search operations, the militant opened fire and he was killed in the exchange of fire, the sources said.

The militant was operating with the code names Shoaib and Yasir and was active in Sopore area from 2007, they said, adding he had come to Kashmir in 2002.

He was involved in many field killings and attacks on mainstream politicians, the sources said, describing his killing as a "great achievement".

A sub-inspector identified as Dilraj was also injured in the encounter.

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AP PHOTOS: Simple surgery heals blind Indonesians

PADANG SIDEMPUAN, Indonesia (AP) — They came from the remotest parts of Indonesia, taking crowded overnight ferries and riding for hours in cars or buses — all in the hope that a simple, and free, surgical procedure would restore their eyesight.

Many patients were elderly and needed help to reach two hospitals in Sumatra where mass eye camps were held earlier this month by Nepalese surgeon Dr. Sanduk Ruit. During eight days, more than 1,400 cataracts were removed.

The patients camped out, sleeping side-by-side on military cots, eating donated food while fire trucks supplied water for showers and toilets. Many who had given up hope of seeing again left smiling after their bandages were removed.

"I've been blind for three years, and it's really bad," said Arlita Tobing, 65, whose sight was restored after the surgery. "I worked on someone's farm, but I couldn't work anymore."

Indonesia has one of the highest rates of blindness in the world, making it a target country for Ruit who travels throughout the developing world holding free mass eye camps while training doctors to perform the simple, stitch-free procedure he pioneered. He often visits hard-to-reach remote areas where health care is scarce and patients are poor. He believes that by teaching doctors how to perform his method of cataract removal, the rate of blindness can be reduced worldwide.

Cataracts are the leading cause of blindness globally, affecting about 20 million people who mostly live in poor countries, according to the World Health Organization.

"We get only one life, and that life is very short. I am blessed by God to have this opportunity," said Ruit, who runs the Tilganga Eye Center in Katmandu, Nepal. "The most important of that is training, taking the idea to other people."

During the recent camps, Ruit trained six doctors from Indonesia, Thailand and Singapore.

Here, in images, are scenes from the mobile eye camps:

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Gas Explosion Levels Buildings Like 'Missile Strike'

A natural gas explosion in one of New England's biggest cities on Friday leveled a strip club with a boom heard for miles and heavily damaged a dozen other buildings but didn't kill anyone, authorities said.

Firefighters, police officers and gas company workers in the area because of an earlier gas leak and odor report were among the 18 people injured in the blast, authorities said.

"This is a miracle on Worthington Street that no one was killed," Lt. Gov. Tim Murray said at a press conference.

The explosion in Springfield, 90 miles west of Boston, blew out all windows in a three-block radius, leaving three buildings irreparably damaged and prompting emergency workers to evacuate a six-story apartment building that was buckling, police said.

Police Sgt. John Delaney marveled at the destruction at the blast's epicenter, where a multistory building housing a Scores Gentleman's Club, evacuated earlier because of the gas leak, was leveled.

"It looks like there was a missile strike here," he said.

The victims were taken to two hospitals in the city. None of their injuries was considered life-threatening, officials said. Those hurt were nine firefighters, two police officers, four Columbia Gas of Massachusetts workers, two civilians and another city employee.

Don Treeger, Springfield Republican/AP Photo

Firefighters responded to the scene at 4:20 p.m. and were investigating the gas leak when the blast happened about one hour later. The cause of the explosion hadn't been identified but was under investigation, they said.

Springfield, which has about 150,000 residents, is the largest city in western Massachusetts. It's known as the home of the Basketball Hall of Fame, which is not in the vicinity of the blast.

The city has been rebuilding from damage it sustained in a June 2011 tornado.

The explosion happened in an area of downtown Springfield with commercial properties and residences. Area resident Wayne Davis, who lives about a block away from the destroyed strip club building, said he felt his apartment shake.

"I was laying down in bed, and I started feeling the building shaking and creaking," he said.

The Navy veteran said the boom from the explosion was louder than anything he'd ever heard, including the sound of a jet landing on an aircraft carrier.

The blast was so loud it was heard in several neighboring communities for miles around. Video from WWLP-TV showed the moment of the explosion, with smoke billowing into the air above the neighborhood.

Mayor Domenic Sarno said it was through "God's mercy" that nobody had been reported killed in the explosion.

"My thoughts and prayers are with the individuals that have been injured and the people who have been displaced," he said, adding that emergency shelter was being set up for those unable to go home.

An official of the gas company said there were no signs of any additional gas leaks in the area but crews would be monitoring the area closely over the next two days.

———

Associated Press writers Bridget Murphy and Bob Salsberg in Boston contributed to this story.

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Gaza ceasefire holds but mistrust runs deep

GAZA/JERUSALEM (Reuters) - A ceasefire between Israel and Hamas held firm on Thursday with scenes of joy among the ruins in Gaza over what Palestinians hailed as a victory, and both sides saying their fingers were still on the trigger.

In the sudden calm, Palestinians who had been under Israeli bombs for eight days poured into Gaza streets for a celebratory rally, walking past wrecked houses and government buildings.

But as a precaution, schools stayed closed in southern Israel, where nerves were jangled by warning sirens - a false alarm, the army said - after a constant rain of rockets during the most serious Israeli-Palestinian fighting in four years.

Israel had launched its strikes last week with a declared aim of ending rocket attacks on its territory from Gaza, ruled by the Islamist militant group Hamas, which denies Israel's right to exist. Hamas had responded with more rockets.

The truce brokered by Egypt's new Islamist leaders, working with the United States, headed off an Israeli invasion of Gaza.

It was the fruit of intensive diplomacy spurred by U.S. President Barack Obama, who sent his secretary of state to Cairo and backed her up with phone calls to Israeli Prime Minister Benjamin Netanyahu and Egyptian President Mohamed Mursi.

Mursi's role in cajoling his Islamist soulmates in Gaza into the U.S.-backed deal with Israel suggested that Washington can find ways to cooperate with the Muslim Brotherhood leader whom Egyptians elected after toppling former U.S. ally Hosni Mubarak, a bulwark of American policy in the Middle East for 30 years.

Mursi, preoccupied with Egypt's economic crisis, cannot afford to tamper with a 1979 peace treaty with Israel, despite its unpopularity with Egyptians, and needs U.S. financial aid.

MORE DEATHS

Despite the quiet on the battlefield, the death toll from the Gaza conflict crept up on both sides.

The body of Mohammed al-Dalu, 25, was recovered from the rubble of a house where nine of his relatives - four children and five women - were killed by an Israeli bomb this week.

That raised to 163 the number of Palestinians killed, more than half of them civilians, including 37 children, during the Israeli onslaught, according to Gaza medical officials.

Nearly 1,400 rockets struck Israel, killing four civilians and two soldiers, including an officer who died on Thursday of wounds sustained the day before, the Israeli army said.

Israel dropped 1,000 times as much explosive on the Gaza Strip as landed on its soil, Defense Minister Ehud Barak said.

Municipal workers in Gaza began cleaning streets and removing the rubble of bombed buildings. Stores opened and people flocked to markets to buy food.

Jubilant crowds celebrated, with most people waving green Hamas flags but some carrying the yellow emblems of the rival Fatah group, led by Western-backed President Mahmoud Abbas.

That marked a rare show of unity five years after Hamas, which won a Palestinian poll in 2006, forcibly wrested Gaza from Fatah, still dominant in the Israeli-occupied West Bank.

Israel began ferrying tanks northwards, away from the border, on transporters. It plans to discharge gradually tens of thousands of reservists called up for a possible Gaza invasion.

But trust between Israel and Hamas remains in short supply and both said they might well have to fight again.

"The battle with the enemy has not ended yet," Abu Ubaida, spokesman of Hamas's armed wing Izz el-Deen Al-Qassam Brigades, said at an event to mourn its acting military chief Ahmed al-Jaabari, whose killing by Israel on November 14 set off this round.

"HANDS ON TRIGGER"

The exiled leader of Hamas, Khaled Meshaal, said in Cairo his Islamist movement would respect the truce, but warned that if Israel violated it "our hands are on the trigger".

Netanyahu said he had agreed to "exhaust this opportunity for an extended truce", but told Israelis a tougher approach might be required in the future.

Facing a national election in two months, he swiftly came under fire from opposition politicians who had rallied to his side during the fighting but now contend he emerged from the conflict with no real gains for Israel.

"You don't settle with terrorism, you defeat it. And unfortunately, a decisive victory has not been achieved and we did not recharge our deterrence," Shaul Mofaz, leader of the main opposition Kadima party, wrote on his Facebook page.

In a speech, Ismail Haniyeh, Hamas's prime minister in Gaza, urged all Palestinian factions to respect the ceasefire and said his government and security services would monitor compliance.

According to a text of the agreement seen by Reuters, both sides should halt all hostilities, with Israel desisting from incursions and targeting of individuals, while all Palestinian factions should cease rocket fire and cross-border attacks.

The deal also provides for easing Israeli curbs on Gaza's residents, but the two sides disagreed on what this meant.

Israeli sources said Israel would not lift a blockade of the enclave it enforced after Hamas won a Palestinian election in 2006, but Meshaal said the deal covered the opening of all of the territory's border crossings with Israel and Egypt.

Israel let dozens of trucks carry supplies into the Palestinian enclave during the fighting. Residents there have long complained that Israeli restrictions blight their economy.

Barak said Hamas, which declared November 22 a national holiday to mark its "victory", had suffered heavy military blows.

"A large part of the mid-range rockets were destroyed. Hamas managed to hit Israel's built-up areas with around a metric tone of explosives, and Gaza targets got around 1,000 metric tonnes," he said.

He dismissed a ceasefire text published by Hamas, saying: "The right to self-defense trumps any piece of paper."

He appeared to confirm, however, a Hamas claim that the Israelis would no longer enforce a no-go zone on the Gaza side of the frontier that the army says has prevented Hamas raids.

(Additional reporting by Noah Browning in Gaza, Ori Lewis, Crispian Balmer and Dan Williams in Jerusalem; Writing by Jeffrey Heller and Alistair Lyon; Editing by Giles Elgood)

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Chan Chun Sing observes joint defence exercise

SINGAPORE: Senior Minister of State for Defence Chan Chun Sing observed Exercise APEX at the Changi Command and Control (C2) Centre on Friday morning.

The exercise, held from 29th October to 27th November, is led by the Singapore Armed Forces' Maritime Security Task Force (MSTF).

It involves over 1,000 personnel from agencies such as the Republic of Singapore Navy (RSN), Air Force (RSAF), the Army and the the Police Coast Guard.

Assets deployed include six patrol vessels, a frigate and a landing ship tank.

The defence ministry said this year's exercise is the eighth in the APEX series.

It is part of the continuing effort to enhance inter-agency collaboration and inter-operability to defend Singapore's territorial waters.

- CNA/xq

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Parliament disruption continues, both houses adjourned till noon

NEW DELHI: Both houses of Parliament were adjourned till 12 noon soon after they met on the second day of the winter session over differences on FDI in retail and quota for SC/ST in promotions.

The Rajya Sabha and the Lok Sabha, which witnessed disruptions on the first day of the winter session on Thursday before being adjourned for the day, saw ruckus on Friday too as the BJP along with the CPM and the Trinamool Congress continued their protest for the second consecutive day.

The Prime Minister Manmohan Singh had yesterday hosted a dinner for L K Advani, Sushma Swaraj and Arun Jaitley, the three top BJP leaders, on Thursday night at his 7 Race Course Road residence in an effort to ensure that the winter session of Parliament is not lost to the standoff between the government and the opposition over the issue of FDI in retail.

At the dinner, the BJP was reportedly adamant that the only way it will allow Parliament to function without disruption is if the government agrees to discuss its major policy decision to allow 51 percent FDI in multi-brand retail under Rule 184, which entails a vote.

The government was equally adamant that it was an executive decision that does not need Parliament's approval. It is ready to discuss the issue, but it does not want a vote.

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Stores Work to Keep Black Friday Safe

With earlier-than-ever deals and 147 million people expected to hit the stores this holiday weekend, retailers such as Best Buy are taking extra steps to avoid the Black Friday shopper chaos -- and inevitable news stories -- of the past.

Best Buy officials said they've been prepping for the madness for days.

The retailer has created color-coded maps, moved merchandise around to ease congestion and held a dry run so that its employees can get practice.

"[We want to] get people in safely and out safely," said Jay Buchanan, a Best Buy employee. The goal is to get them "through the lines quick, fast and in a hurry so they can get what they need."

In Bloomington, Minn., the Mall of America extended its ban on young people younger than 16 shopping without an adult during the weekend evenings to Black Friday.

Daniel Acker/Bloomberg/Getty Images

At the Arden Fair Mall in Sacramento, Calif., security planned to place barricades at the mall entrance to control the crowds and officials planned to double the number of security officers.

In Los Angeles, the police were putting hundreds of extra officers on foot, on horseback and in the air to monitor shopping crowds.

"It seems like Black Friday's become bigger and bigger as the years have gone by," said Los Angeles Police Cmdr. Andrew Smith. "What we've seen across the country are huge problems with crowds. They just forget about everyday courtesy and sometimes go nuts."

According to today's news reports, though, things were already getting out of hand.

When a south Sacramento, Calif., K-Mart opened its doors at 6 a.m. today, a shopper in a line of people that had formed nearly two hours earlier reportedly threatened to stab the people around him.

And at two K-Marts in Indianapolis, police officers were called in after fights broke out among shoppers trying to score vouchers for a 32-inch plasma TV going for less than $200.

"When you have large crowds of people, control is the most important thing," Steve Reed, a security officer at the Arden Fair Mall, told ABC News affiliate News 10. "You want them [customers] to be able to get in the mall without getting trampled and having issues of any kind happening to them. That's really important for us."

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Hamas-Israel ceasefire takes hold but mistrust runs deep

CAIRO/GAZA (Reuters) - A ceasefire between Israel and Gaza's Hamas rulers took hold on Thursday after eight days of conflict, although deep mistrust on both sides cast doubt on how long the Egyptian-sponsored deal can last.

Even after the ceasefire came into force late on Wednesday, a dozen rockets from the Gaza Strip landed in Israel, all in open areas, a police spokesman said. In Gaza, witnesses reported an explosion shortly after the truce took effect at 9 p.m (2 p.m. Eastern Time), but there were no casualties and the cause was unclear.

The deal prevented, at least for the moment, an Israeli ground invasion of the Palestinian enclave following bombing and rocket fire which killed five Israelis and 162 Gazans, including 37 children.

But trust was in short supply. The exiled leader of Hamas, Khaled Meshaal, said his Islamist movement would respect the truce if Israel did, but would respond to any violations. "If Israel complies, we are compliant. If it does not comply, our hands are on the trigger," he told a news conference in Cairo.

Israeli Prime Minister Benjamin Netanyahu said he had agreed to "exhaust this opportunity for an extended truce", but told his people a tougher approach might be required in the future.

Both sides quickly began offering differing interpretations of the ceasefire, brokered by Egypt's new Islamist government and backed by the United States, highlighting the many actual or potential areas of discord.

If it holds, the truce will give 1.7 million Gazans respite from days of ferocious air strikes and halt rocket salvoes from militants that have unnerved a million people in southern Israel and reached Tel Aviv and Jerusalem for the first time.

At the United Nations, the Security Council called on both Israel and Hamas to uphold the ceasefire and commended Egypt's President Mohamed Mursi and others for brokering the truce.

The council said in a statement it "deplored the loss of civilian lives resulting from this situation and reiterated the need to take appropriate steps to ensure the safety and well-being of civilians and their protection in accordance with international humanitarian law."

"Allahu akbar, (God is greatest), dear people of Gaza you won," blared mosque loudspeakers in Gaza as the truce took effect. "You have broken the arrogance of the Jews."

Fifteen minutes later, wild celebratory gunfire echoed across the darkened streets, which gradually filled with crowds waving Palestinian flags. Ululating women leaned out of windows and fireworks lit up the sky.

Meshaal thanked Egypt for mediating and praised Iran for providing Gazans with financing and arms. "We have come out of this battle with our heads up high," he said, adding that Israel had been defeated and failed in its "adventure".

Some Israelis staged protests against the deal, notably in the southern town of Kiryat Malachi, where three people were killed by a Gaza rocket during the conflict, army radio said.

Netanyahu said he was willing to give the truce a chance but held open the possibility of reopening the conflict. "I know there are citizens expecting a more severe military action, and perhaps we shall need to do so," he said.

The Israeli leader, who faces a parliamentary election in January, delivered a similar message earlier in a telephone call with U.S. President Barack Obama, his office said.

"AN OPEN PRISON"

According to a text of the agreement seen by Reuters, both sides should halt all hostilities, with Israel desisting from incursions and targeting of individuals, while all Palestinian factions should cease rocket fire and cross-border attacks.

The deal also provides for easing Israeli restrictions on Gaza's residents, who live in what British Prime Minister David Cameron has called an "open prison".

The text said procedures for implementing this would be "dealt with after 24 hours from the start of the ceasefire".

Israeli sources said Israel would not lift a blockade of the enclave it enforced after Hamas, which rejects the Jewish state's right to exist, won a Palestinian election in 2006.

However, Meshaal said the deal covered the opening of all of the territory's border crossings. "The document stipulates the opening of the crossings, all the crossings, and not just Rafah," he said. Israel controls all of Gaza's crossings apart from the Rafah post with Egypt.

Hamas lost its top military commander to an Israeli strike in the conflict and suffered serious hits to its infrastructure and weaponry, but has emerged with its reputation both in the Arab world and at home stronger.

Israel can take comfort from the fact it dealt painful blows to its enemy, which will take many months to recover, and showed that it can defend itself from a barrage of missiles.

"No one is under the illusion that this is going to be an everlasting ceasefire. It is clear to everyone it will only be temporary," said Michael Herzog, a former chief of staff at the Israeli ministry of defense.

"But there is a chance that it could hold for a significant period of time, if all goes well," he told Reuters.

U.S. Defense Secretary Leon Panetta, in a phone call with his Israeli counterpart, praised the performance of a U.S.-backed Israeli anti-rocket system known as "Iron Dome," which the Pentagon said intercepted over 85 percent of rockets fired at Israeli civilians.

Iron Dome "provided decision space for Israel to achieve its strategic goals without forcing further military actions," the Pentagon said in a statement.

Egypt, an important U.S. ally now under Islamist leadership, took center stage in diplomacy to halt the bloodshed. Cairo has walked a fine line between its sympathies for Hamas, an offshoot of the Muslim Brotherhood to which Mursi belongs, and its need to preserve its 1979 peace treaty with Israel and its ties with Washington, its main aid donor.

Announcing the agreement in Cairo, Egyptian Foreign Minister Mohamed Kamel Amr said mediation had "resulted in understandings to cease fire, restore calm and halt the bloodshed".

U.S. Secretary of State Hillary Clinton, standing beside Amr, thanked Mursi for peace efforts that she said showed "responsibility, leadership" in the region.

The Gaza conflict erupted in a Middle East already shaken by last year's Arab uprisings that toppled several veteran U.S.-backed leaders, including Egypt's Hosni Mubarak, and by a civil war in Syria, where President Bashar al-Assad is fighting for survival.

BUS BOMBING

The ceasefire was forged despite a bus bomb explosion that wounded 15 Israelis in Tel Aviv earlier in the day and despite more Israeli air strikes that killed 10 Gazans. It was the first serious bombing in Israel's commercial capital since 2006.

Israel, the United States and the European Union all classify Hamas as a terrorist organization. It seized the Gaza Strip from the Western-backed Palestinian President Mahmoud Abbas in 2007 in a brief but bloody war with his Fatah movement.

"This is a critical moment for the region," Clinton said. "Egypt's new government is assuming the responsibility and leadership that has long made this country a cornerstone for regional stability and peace."

In Amman, U.N. chief Ban Ki-moon urged both sides to stick to their ceasefire pledges. "There may be challenges implementing this agreement," he said, urging "maximum restraint."

(Additional reporting by Noah Browning in Gaza, Ori Lewis, Allyn Fisher-Ilan and Crispian Balmer in Jerusalem, Yasmine Saleh, Shaimaa Fayed and Tom Perry in Cairo, Suleiman al-Khalidi in Amman, Michelle Nichols at the United Nations and Margaret Chadbourn and Phil Steward in Washington.; Writing by Alistair Lyon and David Stamp; Editing by Louise Ireland and Christopher Wilson)

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