Gaza/Occupied Jerusalem: Israel launched air strikes across the Gaza Strip on Friday in response to Palestinian rockets after Egyptian-mediated talks failed to extend a 72-hour truce in a month-long war.
Egypt later called for a resumption of the ceasefire, saying only a few points remained to be agreed. Palestinian factions said they would meet Egyptian mediators later in the day, but there was no sign of any imminent deal.
An Israeli government official said Israel would not negotiate with Palestinians while they continued to unleash missiles.
Islamic Jihad and the Popular Resistance Committees claimed responsibility for the salvoes from the Hamas-dominated enclave.
Accusing Hamas of breaking the ceasefire, Israel said several of the rockets had been launched about four hours before the truce was due to end at 08:00 (0500 GMT). Heavier barrages followed shortly after the ceasefire period expired.
By resuming the attacks, Gaza fighters appeared to be trying to put pressure on Israel, making clear they were ready to fight on to end a blockade of the coastal territory that both Israel and neighbouring Egypt have imposed.
In the first casualties since hostilities resumed on Friday, Palestinian medical officials said a 10-year-old boy was killed in an Israeli strike near a mosque in Gaza City. An Islamic Jihad fighter was killed in a later hit, local officials said.
In Israel, police said two people were injured by mortar fire from Gaza.
After a huge explosion in Gaza City, apparently from an air raid, a military spokesman said Israel had responded to Hamas rocket fire by launching air strikes at "terror sites" across the Gaza Strip.
"We will continue to strike Hamas, its infrastructure, its operatives, and restore security for the State of Israel," Lieutenant-Colonel Peter Lerner said in a statement.
Heavy civilian casualties and destruction during Israel's campaign against militants in packed residential areas of the Gaza Strip have raised international alarm over the past month, but efforts to prolong a ceasefire at talks in Cairo failed.
Hamas spokesman Sami Abu Zuhri said Israel had rejected most Palestinian demands. "However, we did not close the door and will continue with the negotiations," he said. His comments came in response to a statement from the Egyptian foreign ministry, which indirectly blamed the Palestinians for refusing to end the truce.
Egypt said an agreement had been reached on the major issues of concern to the Palestinian people and only a few sticking points remained.
The Palestinians had wanted Israel to agree in principle to demands which include lifting the blockade on the Gaza Strip, the release of prisoners and the opening of a sea port, but this had been rebuffed, Abu Zuhri said.
Israel has shown little interest in easing its naval blockade of Gaza and controls on overland traffic and airspace, suspecting Hamas could restock with weapons from abroad.
Gaza officials say the war has killed 1,877 Palestinians, most of them civilians. Hamas said on Thursday it had executed an unspecified number of Palestinians as Israeli spies.
Israel says 64 of its soldiers and three civilians have died in the fighting that began on July 8, after a surge in
Palestinian rocket salvoes into Israel. It expanded its air and naval bombardment of the Gaza Strip into a ground offensive on July 17, and pulled its infantry and armour out of the enclave on Tuesday after saying it had destroyed more than 30 infiltration tunnels dug by Palestinian fighters.