Gaza: Israel and Hamas studied a proposal by Egypt for a ceasefire in the Gaza Strip on Wednesday that won immediate backing from the United States and Europe, hours after Israeli shells killed 42 Palestinians at a U.N. school.

However, Israeli officials also said ministers would discuss a major escalation of their 12-day-old offensive that would push troops deep inside Gaza's cities and refugee camps in their bid to end rocket fire into Israel by Islamist militant groups.

A Palestinian official said Hamas leaders, who want an end to Israel's blockade of the coastal enclave, had been briefed in Egypt on the proposals by President Hosni Mubarak and were debating them internally.

Israeli officials have said they too are willing to look seriously at plans that would satisfy their demand that Egypt cut off Hamas's supplies of smuggled weapons.

Mubarak made his ceasefire call at a joint news conference in Egypt with French President Nicolas Sarkozy. He gave little detail, but diplomats have described a process that would focus on bringing in foreign forces to seal the Egypt-Gaza border to Hamas arms smugglers while easing other trade routes.

Sarkozy, winding up a two-day tour of the Middle East, said: "I am confident the Israeli authorities' reaction will make it possible to consider putting an end to the operation in Gaza."

With Washington hamstrung by the transition period ahead of the January 20 inauguration of President-elect Barack Obama, France and its European partners, with backing from U.S. allies in the Arab world, have been pushing hard for Israel to cease fire.

But Secretary of State Condoleezza Rice, speaking at the United Nations, quickly endorsed the Mubarak proposal and said a "sustainable" ceasefire should involve both closing off Hamas's ability to rearm through tunnels from Egypt and easing the lives of the 1.5 million people of Gaza by reopening its trade routes.

"We need urgently to conclude a ceasefire that can endure and that can bring real security," Rice told the Security Council.

She also welcomed an offer by Israel to open what it called a "humanitarian corridor" that would let aid agencies more easily distribute food and medicine around Gaza while it continues its military operation, which has killed over 600 people and carved the 40-km (25-mile) strip into several zones.

Source : Reuters