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A Grad-type missile fired by Gaza Strip militants struck the coastal city of Ashkelon on Thursday evening, as the defense establishment was preparing for a military move against Hamas targets in the coastal territory.

The missile came at the end of a day that saw five Qassam rockets and two mortar shells fired from Gaza into Israel. One of the rockets struck just outside Ashkelon. No one was wounded in Thursday's attacks.

Thursday's count came after Hamas launched more than 80 rockets and mortar shells into Israel on Wednesday.

However, Defense Minister Ehud Barak announced late Thursday that despite Israel's policy of closing Gaza border crossings in response to rocket fire, he would authorize the passage of humanitarian aid into the Gaza Strip on Friday.

On Wednesday, as an initial retaliatory measure, an Israel Air Force strike killed a Hamas gunman in the southern Gaza Strip, and wounded two other Palestinians. Israel's response will go beyond the air raid, an Israeli official told Haaretz.

"Our response will be substantial and painful to Hamas," the official said.

By late morning Wednesday, the Magen David Adom rescue service declared its highest level of alert.

One of the rockets launched Wednesday exploded next to a children's playground in the southern town of Netivot and a mortar shell scored a direct hit on a house in Kibbutz Sha'ar Hanegev, causing extensive damage. A house in the community of Sdot Negev was also severely damaged after it absorbed a direct rocket hit.

Two more rockets, including a Grad-type missile, exploded in a public area in the northern Negev city of Ashkelon.

During a cabinet meeting about the situation in and outside the Gaza Strip, a senior Israel Defense Forces officer gave ministers in attendance an overview of the potential retaliatory moves that the defense establishment is planning against Hamas' regime.

Most strikes will come from the air and be aimed at facilities believed to be of strategic importance to Hamas' political and military leadership. However, the officer said that weather conditions are currently preventing the air force from launching the raids.

According to officials in Jerusalem, the overview also included a special reference to the possible implications of attacking Hamas.

"We are not eager to strike, but we will not hesitate to act," one official said. "If Hamas is looking for noise, we will make Gaza very noisy."

Prime Minister Ehud Olmert's government said it had shown restraint until now but vowed to act if the salvoes continued.

The same official said that Israel would be willing to extend the June cease-fire, which expired last week, if Hamas would agree to resuming it.

Foreign Minister Tzipi Livni is expected to arrive on Thursday in Cairo for a meeting with Egyptian President Hosni Mubarak, whose administration helped facilitate the cease-fire. Sources close to Livni said she intended to tell Mubarak that Israel will not accept Hamas' current terms for a ceasefire. Hamas' statements also contained a similar mix of threats and assurances.

"Hamas will hit not only Sderot, but also what lies beyond Sderot," Hamas legislator Mushir al-Masri said, in a possible reference to extended ballistic capabilities.

Other spokespeople said the organization will agree to "resume" the ceasefire, if the organization's conditions are met. Hamas is demanding an improved ceasefire agreement, that also includes the West Bank.

In a statement by Hamas' military wing, Iz al-Din al-Qassam, a spokesperson warned that "thousands of additional Israelis will soon be within the range of our rockets if Israel continues with its aggression."

"The residents of the south will stay in the bomb shelters for a long time," the Hamas statement continued, adding that "threats of an [Israeli] military offensive don't scare us because we are more prepared than ever."

All Israeli towns within a 30-kilometer radius of the Gaza Strip were hooked up on Wednesday to an early warning system designed to deliver rocket launch alerts. Among the newly-connected towns and cities are Ofakim and Netivot.

Ashdod, with its center just outside the 30-kilometer mark, is expected to be connected to the system within the next 24 hours. Some towns are already connected to the "Color Red" system, which alerts residents living within a seven-kilometer radius of the Strip.

Meir Yifrach, head of Sdot Negev Regional Council, said that the current situation was intolerable and that "the people of the southern region of Israel are demanding that the government order the army to act in Gaza so that civilian life may be allowed to return to normal."

"It defies logic that the firing of so many Qassam should be allowed to cause so much fear and damage to the people of Israel during Hannukah," he said. "It started with a drizzle, then the Qassams began to rain down hard, and now we're already experiencing a deluge."

Yanir Yagna contributed to this article.