US pushes for truce as Gaza battle rages

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A International Red Cross employee runs for cover after an Israeli strike during a two-hour temporary ceasefire in Gaza City’s Shijaiyah neighborhood, Wednesday, July 23, 2014. Israeli troops battled Hamas militants on Wednesday near a southern Gaza Strip town as U.S. Secretary of State John Kerry reported progress in efforts to broker a truce in a war that has so far killed more than 650 Palestinians and at least 30 Israelis. (AP Photo/Khalil Hamra)

A International Red Cross employee runs for cover after an Israeli strike during a two-hour temporary ceasefire in Gaza City’s Shijaiyah neighborhood, Wednesday, July 23, 2014. Israeli troops battled Hamas militants on Wednesday near a southern Gaza Strip town as U.S. Secretary of State John Kerry reported progress in efforts to broker a truce in a war that has so far killed more than 650 Palestinians and at least 30 Israelis. (AP Photo/Khalil Hamra)

A Palestinian youth carries blankets donated to the United Nations school where hundreds of families sought refuge after fleeing their homes due to heavy Israeli missile strikes in Gaza City, Wednesday, July 23, 2014. Hundreds of thousands of Palestinians have fled their homes and are staying in 77 UN shelters, according to UNRWA, the U.N. refugee agency for Palestinians. The number of people who have been forced to seek shelter has increased nearly six-fold since the start of Israel’s ground operation. (AP Photo/Lefteris Pitarakis)

U.S. Secretary of State John Kerry, left, meets with Israeli Prime Minister Benjamin Netanyahu in Tel Aviv, Israel, Wednesday, July 23, 2014. Kerry flew into Tel Aviv despite a Federal Aviation Administration ban following a Hamas rocket that hit near the airport the day before, reflecting his determination to achieve a cease-fire agreement between the warring sides. (AP Photo/Pool)

Israeli Captains of the Armored Corps carry the coffin of Captain Natan Cohen, platoon commander, during his funeral at the military cemetery in Modiin, near Jerusalem Israel, Wednesday, July 23, 2014. Cohen, 23, was killed while fighting in the Gaza Strip on Tuesday. (AP Photo/Ariel Schalit)

A departure flight board displays various canceled and delayed flights in Ben Gurion International airport a day after the U.S. Federal Aviation Administration imposed a 24-hour restriction on flights after a Hamas rocket landed Tuesday within a mile of the airport, in Tel Aviv, Israel, Wednesday, July 23, 2014. U.S. Secretary of State John Kerry flew into Israel’s main airport Wednesday despite a Federal Aviation Administration ban in an apparent sign of his determination to achieve a cease-fire agreement in the warring Gaza Strip despite little evidence of progress in ongoing negotiations. (AP Photo/Dan Balilty)

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GAZA CITY, Gaza Strip (AP) — The United States announced signs of progress in cease-fire talks Wednesday, but prospects for a quick end to the fighting were dim as Palestinian families fled fierce battles in southern Gaza and the death toll rose to more than 700 Palestinians and 34 Israelis.

Underscoring the challenges facing international negotiators shuttling around the Middle East in a high-profile bid to end the bloodshed, the leader of Hamas insisted the Islamic militants would not relent until their main demand of lifting an Egyptian-Israeli blockade of the Gaza Strip is met.

On the ground, meanwhile, Israeli troops backed by tanks and aerial drones clashed with Hamas fighters armed with rocket-propelled grenades and assault rifles on the outskirts of Khan Younis, killing at least eight militants, according to a Palestinian health official. Hundreds of people fled their homes as the battle unfolded, flooding into the streets with what few belongings they could carry, many with children in tow. They said they were seeking shelter in nearby U.N. schools.

“The airplanes and airstrikes are all around us,” said Aziza Msabah, a resident of the city in the southern Gaza Strip. “They are hitting the houses, which are collapsing upon us.”

U.S. Secretary of State John Kerry, who met for the second time this week with United Nations chief Ban Ki-moon, flew to Israel on an Air Force jet, despite a ban imposed a day earlier by the U.S. Federal Aviation Administration on commercial flights into Ben-Gurion Airport because of Hamas rocket fire nearby. The FAA extended the ban Wednesday and many major European carriers also canceled more flights due to security concerns.

“We certainly have made steps forward,” Kerry said in Jerusalem, without elaborating. “There’s still work to be done.”

Israel has insisted it must substantially curb the military capabilities of the Islamic militant group that controls Gaza — a position that appears to have gained support within the U.S. administration — while Hamas has demanded the lifting of a crippling Israeli and Egyptian blockade on the impoverished coastal territory it has ruled since 2007.

Hamas leader Khaled Mashaal said in a televised speech that the opening of the border crossings was a red line.

“When it comes to the balance of power in this crisis between us and Israel, they are the executioners, the aggressors, the occupiers, the settlers, and we are the true owners of the land,” he said from his home-in-exile in Doha, Qatar. “We will not accept anything but the end of the siege.”

The U.S., Israel and the European Union all consider Hamas a terrorist organization, though the U.N. does not. Ban said he and Kerry were jointly lobbying officials in the region to push Hamas and Israel to a cease-fire as soon as possible.

White House deputy national security adviser Tony Blinken said there must be a way forward that does not involve Hamas having the ability to “rain down rockets on Israeli civilians.”

“One of the results, one would hope, of a cease-fire would be some form of demilitarization so that this doesn’t continue, doesn’t repeat itself,” Blinken said in an interview with NPR. “That needs to be the end result.”

The Hamas leader, however, rejected that idea. “Some are talking under the table about disarming the resistance. No one can take away the resistance’s

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