10 Palestinian Militants Killed in Gaza

Israeli armored vehicles drive out of the northern Gaza Strip into Israel after finishing an operation, Wednesday, Sept. 5, 2007. Israeli leaders on Wednesday decided against a large-scale military response to repeated rocket fire from the Gaza Strip, but said they would consider cutting off electricity or other vital supplies to the impoverished area if the attacks persist, meeting participants said. (AP Photo/Ariel Schalit) (Ariel Schalit - AP)

"We will act every day against the terrorists," Olmert said. "This very day many in Gaza paid with their lives because of the (rockets)."

In Gaza, Hamas official Osama Muzini turned down a request by the Red Cross to visit an Israeli soldier captured in a cross-border raid in June 2006. He said allowing a visit might lead Israel to the soldier. The request was made Wednesday by the director-general of the International Committee of the Red Cross during a visit to Gaza.

The clash between Israeli forces and Palestinian militants was south of the main flashpoint in Gaza, the northeast corner of the seaside territory where militants have been launching homemade rockets at nearby Israeli communities just across the border fence.

The daily barrages have wreaked panic among Israel's southern population and led to demands for retaliation.

Israel's Security Cabinet on Wednesday rejected calls for a large-scale Gaza invasion but threatened to cut water, electricity and fuel supplies to Gaza.

However, Defense Minister Ehud Barak told a gathering of top defense officials that "there is recognition that in the end, Israel will have to operate inside the Gaza Strip," participants at the meeting said. They spoke on condition of anonymity because the meeting was closed.

Israel has mounted such operations in the past, with casualties on both sides, but the large-scale military strikes have failed to quell the rocket fire. Israeli military experts have said that short of recapturing all of Gaza, there is no military solution.

Israel withdrew from Gaza in 2005, removing 21 settlements and all its army bases.

Parents in the rocket-scarred Israeli town of Sderot kept their children home again Thursday, demanding better protection. Children have stayed away from school since a rocket exploded next to a nursery school on Monday, the second day of the school year. Israeli media said school would resume Friday.

Also Thursday, a Palestinian policeman was shot dead by gunmen in the northern West Bank town of Jenin. Police said Akram Abu Sba, 40, was shot in the chest by Islamic Jihad militants after he stopped their car for a routine check.