There are hopes of a ceasefire in the Gaza Strip as the death toll passes 1,000. An Israeli envoy is due to meet Egyptian mediators in Cairo after Hamas delegation concluded talks on a truce proposal by saying they wanted a ceasefire but demanded Israel withdraw its troops and lift a blockade of Gaza. Spain's Foreign Minister Miguel Angel Moratinos, a former EU Middle East envoy, said: "My perception is we are very close to reaching a ceasefire. They are very close but still there is some work to be done." Meanwhile, Israeli tanks and artillery kept up a relentless bombardment of Gaza City, with shells exploding in downtown areas and machinegun fire raking cramped housing blocks. Israeli forces have encircled the city of 500,000 Palestinians for days. Tanks have made forays towards the centre to test the resistance of Hamas and other militant groups but have held off a full-scale assault on the densely populated streets. The Palestinian death toll has risen to at least 1,024, according to the Hamas-run Health Ministry in Gaza. A Palestinian rights group said 670 of the dead were civilians. Thirteen Israelis - ten soldiers and three civilians have been killed. Israel, which wants an end to rocket attacks on its towns and guarantees that Hamas cannot smuggle in more weapons from tunnels to neighbouring Egypt, said it would not agree to a truce allowing the Palestinian Islamists to regroup and rearm. Having launched the Gaza offensive on December 27 to counter Palestinian rocket fire, the Israeli government has been unclear about whether the assault could soon end or be stepped up. Israel sent warplanes to drop bunker-busting bombs along the frontier between Gaza and Egypt in a bid to destroy tunnels used to smuggle in weapons.