Michele Chabin, Ruth Eglash and Naser Najjar, Special for USA TODAY
GAZA CITY - Palestinian militants fired a rocket toward Jerusalem on Tuesday, causing an explosion moments after air raid sirens sounded across the city.
The sound of the blast, which could be heard in the distance from downtown Jerusalem, came as Israeli aircraft pounded the headquarters of an Hamas bank and diplomats in Cairo held talks about a possible cease-fire.
Police spokesman Micky Rosenfeld said the rocket apparently did not reach the city and authorities are searching for the blast site, the Associated Press reported.
It's the second rocket attack aimed at Jerusalem since a round of fighting broke out between Israel and Palestinian militants in Gaza last Wednesday.
Jerusalem, nearly 50 miles from Gaza, is the most distant city the militants have targeted.
In Gaza City, meanwhile, the Israeli strike on the Islamic National Bank was part of an escalating Israeli assault against Gaza militants meant to quell rocket attacks on Israeli cities. The bank was set up to evade international sanctions on its rule.
Hamas leaders said during cease-fire talks that they would not end the rocket attacks unless Israel ended a blockade of Gaza borders that it maintains to keep weapons out of the hands of terrorists.
The standoff was being discussed in Cairo where diplomats from Egypt and Turkey were in talks with Hamas about a cease-fire. An Israeli official was in Cairo, but the Israeli government would not comment.
U.N. chief Ban Ki-moon, who is in Cairo on an emergency mission to negotiate a truce, said that the situation was "alarming."
"This must stop, immediate steps are needed to avoid further escalation, including a ground operation," Ban said from Cairo. "Both sides must hold fire immediately ... Further escalation of the situation could put the entire region at risk."
On Tuesday, the White House said that President Obama is sending Secretary of State Hillary Rodham Clinton to the Middle East in hopes that she can help mediate the conflict. Clinton will begin by meeting with Israeli Prime Minister Benjamin Netanyahu in Jerusalem.
By Tuesday, civilians accounted for 54 of the 113 Palestinians killed since Israeli airstrikes began Wednesday in response to the launching of nearly 200 rockets against Israeli towns. Some 840 people have been wounded, including 225 children, Gaza health officials said.
Israel has said that Hamas bears responsibility for the deaths of civilians because terrorists are using civilians as shields.
Egyptian Prime Minister Hesham Qandil told Reuters that a cease-fire agreement may be signed soon. "I think we are close, but this kind of negotiations is very difficult, and it is hard to make predictions."
The leader of Hamas took a tough stance, rejecting Israel's demands that the militant group stop its rocket fire. Instead, Khaled Mashaal said Israel must meet Hamas' demands for a lifting of the blockade of Gaza.
"We don't accept Israeli conditions because it is the aggressor," he told reporters in Egypt. "We want a cease-fire along with meeting our demands."
An Israeli official said Israel hoped to find a diplomatic solution to the crisis as well and signaled Egypt was likely to play a key role in enforcing any truce.
"We prefer the diplomatic solution if it's possible. If we see it's not going to bear fruit, we can escalate," he said, speaking on condition of anonymity because of the sensitive diplomatic efforts under way.
If the rockets continue, a ground invasion may be launched to stop the missiles, according to Israeli Prime Minister Benjamin Netanyahu. Some analysts say such a course carries a risk for Israel.
"I think for Hamas the risk of a ground invasion is that they basically get dominated on the battlefield and that is likely what would happen," said Jonathan Schanzer of the Foundation for Defense of Democracies in Washington. "But on the Israeli side there is some real risk, too. The longer (Netanyahu) stays in this war, the greater the possibility that something goes wrong... unwelcome civilian casualties could potentially hurt him."
One of the Israeli airstrikes Monday hit a Hamas television building that had been struck previously over the weekend, killing four members of Islamic Jihad, a terrorist group that is backed by Iran, the Israeli Defense Forces announced.
The four targeted terrorists included Baha Abu el Ata, a Gaza brigade commander involved in firing rockets into southern Israel; Tyseer Abu Al Ata, a senior Islamic Jihad member; and Halil Bahatini, involved in the Islamic Jihad's long-range rocket launchings.
Islamic Jihad announced on a website that commander Ramez Harb was killed in the strike, which the IDF said was a significant operation involving intense intelligence efforts.
The IDF said the men were involved in getting into Gaza the long-range Fajr-5 rockets that are made in Iran and sneaked into Gaza through smuggling tunnels from Egypt. These rockets have a much wider range than other rockets of Hamas and can reach almost anywhere in Israel.
It is those missiles that Israel has been targeting and hoping to destroy, according to the IDF.
Israel has also been attacking homes of activists in Hamas, which has orchestrated the firing of more than 1,100 rockets into Israel, the IDF said. Israel's Iron Dome defensive missile system has shot down 320 of the rockets, the IDF said.
About 75 Hamas rockets were fired Monday, among them one that hit an empty school. Others hit a house and a yard.
In Gaza, some people were moving deeper into the territory to try and avoid Israeli airstrikes.
"But given that the whole of Gaza Strip is an area of just around (215 square miles) their attempts of moving away from the border does not make such a big difference in terms of safety," said Sukrit Kapoor, a lawyer with the Palestinian Center for Human Rights in Gaza.
Power outages can last 10 hours a day.
"When the power cuts happen during the day, we can manage," said Soad Al Tartor, a mother of five. "But when it cuts out at night, the house is dark and the sounds of the explosions heightens the fear among us."
Many Gazans rely on generators for electricity, but gas stations have run dry.
"I spend half of my day searching for fuel," taxi driver Ahmed Abu Amra said.
In Ashkelon in southern Israel "Code Red" sirens sounded throughout the day in cities, towns and open areas.
Even though the Iron Dome defense system intercepted most of the projectiles, there were several direct hits on buildings and yards. A handful of people were injured and many were dealing with shock from the constant blasts, said Benny Vaknin, mayor of Ashkelon.
The mayor spoke while looking over damage to Henry Ronson High School in Ashkelon, where a Hamas-fired rocket had scored a direct hit, bursting through the cement roof of a school walkway.The rocket did not explode and the school was empty at the time.
"The difference between our operation and that of Hamas is that they aim to hit schools and areas crowded with civilians," Vaknin said.
Alerts and air raid sirens were heard throughout the day in Israel's south from Beer Sheva and Sderot all the way up to Ashdod and beyond. There were two rocket interceptions near Tel Aviv.
Any cease-fire deal would draw mixed reviews from the Israeli towns and villages that have been the target of Hamas rockets.
Lior Amar, 24, who works at a sunglasses store in Beer Sheva, has had to run for cover multiple times a day this past week as megaphones blast warnings of incoming missiles.
"Seven, 10, even 12 sirens a day," she said. "We can't leave our homes," she said. Amar said the Palestinians "use every cease-fire to get themselves re-armed" by Iran, Syria and Egypt.
"We need to get rid of every terror cell in Gaza," she said. "The people of Gaza also want the terror organizations destroyed. The terrorists sacrifice their own people."
Israeli Brig. Gen. Yoav Mordechai said the aim of the latest missile strikes is to degrade Hamas' missile infrastructure so it cannot resume its rocket attacks.
"We have hit many structures being used to launch missiles against Israel, including weapons storage and tunnels linking Egypt to Gaza,"he said, pointing out that Gaza's soccer stadium was struck Monday because it was doubling as a base for launching rockets.
Israelis are solidly behind the military action. Six days into the aerial attack on Gaza, 84% of the Israeli public said it supports so-called Operation Pillar of Defense, according to a Haaretz-Dialog poll taken Sunday.
Oranit Ben-Gira, 25, is among those who supports the military strikes and is against an immediate cease-fire.
"For the past four years we've suffered through rocket fire that's made it impossible to lead normal lives," Ben-Gira said. "We need to do the job in Gaza so we can live in peace."
In Beer Sheva, most of the city's 200,000 residents took shelter in secure rooms, if they had them, or bomb shelters. Hundreds of regular soldiers and reservists waited at Beer Sheva's Central Bus Station for transport to the Gaza border some 25 miles away.
The mostly young men and women in uniform (women are also drafted in Israel) said they were trying to stay upbeat.
"I need to go and help my country any way I can," said Naftali Kassa, 27, a driver in civilian life. His rumpled uniform, taken out of storage, and gray sneakers identified him as a reservist.
Ehud Zion-Waldoks, a university spokesman who moved from Jerusalem to Beer Sheva four months ago, decided to temporarily relocate his wife and three young children from harms ways.
Zion Waldoks returned to Beer Sheva for work this morning, after which five sirens wailed.
"For one siren there were four booms, one of which shook the house," he said. "I feel safe in my house because we have an actual bomb shelter off the kitchen. I don't feel safe outside, going to and from work. My wife, who can't work on her doctorate due to the situation, and kids are now in Jerusalem."
He said his 5-year-old daughter was "a little upset" when a siren sounded in Jerusalem "after we'd told her the rockets couldn't reach there."
Right now he and his wife "take it day by day. We assess every evening what will be done. I don't' know whether this - either not being at home or being at home with five sirens a day - is possible long term."
Hanita Shariki sought shelter at a public bomb shelter in the Central Bus Station, an underground concrete room that can accommodate more than 100 people. She was not in favor of a cease-fire.
"The army mustn't stop until it's done the job," she said as she climbed the stairs out of the shelter, the rocket having hit a house.
The Negev desert area, where Beer Sheva is located, is home to nearly 200,000 Bedouin Arabs who live in towns, cities and encampments. Some said they don't like the rocket attacks from Gaza, but their sympathies lie with the Palestinians.
"I wish the army would stop shelling Gaza," said Aisha al Hawasha, 21, a Bedouin student from a village near Dimona.
Dressed in a traditional Muslim head scarf and robe, al Hawasha acknowledged that "it's difficult to live with the rocket fire" from Gaza, but also that it is "difficult to see what is happening to our brothers in Gaza."
Contributing: Associated Press