But Prime Minister Ismail Haniya of Hamas was due to convene leaders of 12 Palestinian factions in Gaza City Thursday evening to discuss a draft proposal for ending an Israeli offensive in Gaza begun after the June 25 abduction of 19-year-old Gilad Shalit.
'Efforts are in place that lead us to believe a solution is imminent,' Abbas told reporters in Rome after a meeting with Italian Prime Minister Romano Prodi.
'I hope that the soldier is in good health and can soon return to his family,' he added.
Shalit's capture by Hamas and two other groups from an Israeli army outpost bordering Gaza had triggered the ongoing offensive in Gaza. Since then, the July 12 capture of two other soldiers by the Lebanese Shiite Hezbollah movement has sparked the current Israel- Lebanon crisis.
If true, Abbas' statements would mean a breakthrough in the two-front Middle East crisis.
But Hamas's armed wing, the al-Qassam Brigades, quickly issued a leaflet saying 'what was announced by President Abbas that the captive soldier Gilad Shalit will be handed over is untrue.'
'There is nothing new from our side regarding the issue,' said also a Hamas spokesman, Abu Obaida. 'We heard this news from the press and our stance remains as it was: The case is in the hands of resistance fighters.'
Haniya and representatives of other Palestinian factions will 'discuss the possibility of reaching a ceasefire deal to stop the bloodshed,' a source in Hamas close to the premier said.
However, the deal depends on Israel's readiness to accept it in principle, the source said.
Hamas however has not backed down from its demand that Israel release Palestinian militants from its jails in return for Shalit's freedom, while Israel continues to demand the soldiers' unconditional release.
The initiatives do not include 'any thing saying that the soldier has to be handed over for free. No politician dares to demand handing the soldier over without a return,' Abu Obaida told reporters.
And Defence Minister Amir Peretz reiterated in a news conference in Tel Aviv Thursday night that 'we have no intention whatsoever to negotiate with Hamas.'
Abbas, ahead of his meeting with United States Secretary of State Condoleezza Rice in Ramallah Wednesday, had earlier proposed a deal that would include a cessation of rocket fire from Gaza at southern Israel, but the militant factions rebuffed it, the Hamas source said.
A group of Palestinian lawmakers were now drawing up a new plan.
As Israel's offensive in Gaza continued unabated, an airstrike on Gaza City's al-Sha'af neighbourhood Thursday killed two Palestinian militants of the radical Islamic Jihad faction.
Another 13 people were injured, three of them critically, hospital officials said.
A 75-year-old Palestinian woman was killed and her two sons injured earlier Thursday when an Israeli artillery shell hit their house in north-east Gaza City.
Some 23 Palestinians were killed Wednesday in one of the heaviest days of fighting since the offensive began one month ago, as local militants confronted Israeli troops entering the northern Gaza Strip.
© 2006 dpa - Deutsche Presse-Agentur
Hamas has denied claims made by Palestinian President Mahmoud Abbas that Israeli soldier, Gilad Shalit, 19, captured on June 25, will be released.

"Nothing has changed in the case of the Israeli soldier. The file remains in the hands of the resistance factions and not in the hands of any politician even if that politician is Abu Mazen Mahmoud Abbas. We heard this news from the press and our stance remains as it was: The case is in the hands of resistance fighters," said spokesman for the Izz el-Deen al-Qassam Brigades, Abu Ubaida.

Ubaida also said that handing over the soldier doesn't come "free. No politician dares to demand handing the soldier over without a return."

Abbas was quoted as saying earlier in a press conference, held in Rome, by an Italian translator that talks were leading to an "imminent solution" that would allow for the release of the soldier. "With regards to the issue of the abducted Israeli soldier, I have reiterated that there are ongoing efforts that lead us to believe in an imminent solution. I hope that the soldier is in good health and can soon return to his family," said Abbas, according to the official Italian translator.

However; the Associated press quoted Abbas as saying that "intense negotiations" were taking place.