Hamas, Fatah truce collapses in bloodshed, 8 dead

GAZA, June 11 (Reuters) Palestinian gunmen fought inside a hospital and fired on the prime minister's offices after a truce collapsed today, killing eight people in factional violence that cast fresh doubt over the future of the unity coalition.

''Everybody is shooting at everybody,'' a doctor at the Beit Hanoun hospital in the northern Gaza Strip said as a gunbattle raged between the Islamist Hamas and secular Fatah groups.

A member of Hamas's Executive Force, two Fatah fighters and another person, who was not immediately identified, were killed and 19 people wounded, hospital officials said.

The heavy fighting doomed an Egyptian-brokered ceasefire announced just hours before and threw a shadow over long-term prospects for the unity coalition that Hamas and Fatah formed three months ago.

The truce was the latest attempt to end internal strife in which some 620 Palestinians are estimated to have been killed since Hamas beat Fatah in a 2006 election.

The hospital battle, waged inside and outside the facility, was triggered by the shooting of a bodyguard of an intelligence officer affiliated with President Mahmoud Abbas's Fatah faction.

Relatives of the dead man and Fatah fighters then stormed the hospital, which is guarded by the Executive Force, a security contingent loyal to Hamas.

In a separate incident, two gunmen - one from Fatah and the other from Hamas - were killed in a clash in a refugee camp in Gaza City. A Hamas fighter was killed in violence in the town of Beit Lahiye in northern Gaza.

Earlier, gunmen fired on the offices of Palestinian Prime Minister Ismail Haniyeh of Hamas. No one was hurt in the attack, which an aide to Haniyeh blamed on Fatah.

But the cabinet session that had been under way in the building was suspended because of the gunfire from a nearby rooftop. Fatah denied its fighters were involved. Only one Fatah minister attended the meeting.

MOSQUE ATTACK Gunmen also stormed a mosque in Gaza City, damaging a library, Hamas said. The incident touched off a gunbattle outside the house of worship. Fatah denied any involvement.

A key motive behind the latest truce was to permit 70,000 high school students in Gaza and the occupied West Bank to take their matriculation exams peacefully.

The tests began on schedule in Gaza. But most pupils took circuitous routes to their schools in a bid to avoid the gunmen, witnesses said.

Musbah Abu al-Kheir, 17, passed several armed checkpoints on his way to school from a refugee camp outside Gaza City.

''Fatah and Hamas have no appreciation for the fact we are having final exams today,'' he said. ''How are we supposed to take exams to the sounds of gunfire and ambulance sirens?'' Israeli Prime Minister Ehud Olmert said ahead of a visit to Washington next week and possible talks with Middle East power brokers in Egypt later in the month that he was ''prepared to renew talks ... at any time'' with the US-backed Abbas.

Abbas cancelled talks with Olmert last week in a dispute over Israel's withholding of Palestinian tax revenues. A senior aide to Abbas said the president stood ready to meet Olmert any time - once Israel released the money.

REUTERS DS BST2203