France and Egypt announced an initiative to stop the fighting in Gaza late Tuesday, hours after Israeli mortar shells exploded near a UN school sheltering hundreds of people displaced by the onslaught on Hamas militants. At least 30 Palestinians died, staining streets with blood.

The Egyptian and French presidents didn't release details of their proposal, saying only that it involved an immediate cease-fire to permit humanitarian aid into Gaza and talks to settle the differences between Israel and the Islamic militants of Hamas who rule the small coastal territory.

They said they were awaiting a response from Israel. Israeli officials in Jerusalem declined immediate comment on the announcement, which came amid diplomatic efforts by the US and other nations to resolve a conflict that has seen 600 people killed in 11 days.

Secretary of State Condoleezza Rice welcomed the initiative, but cautioned that no agreement would succeed unless it halted Hamas rocket attacks on Israel and arms smuggling into Gaza.

Earlier in the day, President-elect Barack Obama broke his silence on the crisis, saying that “the loss of civilian life in Gaza and in Israel is a source of deep concern for me.'' He declined to go further, reiterating his stance that the US has only one president at a time.

Israel's military said its shelling at the school - the deadliest single episode since Israeli ground forces invaded Gaza on Saturday after a week of air bombardment - was a response to mortar fire from within the school and said Hamas militants were using civilians as cover.

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