World leaders are urging restraint in the wake of the latest Mideast violence. But those pleas don't seem to be penetrating the din of threats between Israelis and Palestinians. Both sides are vowing to step up the fight.

Following the assassination of Hamas' spiritual leader Sheik Ahmed Yassin, the group named a new leader Tuesday. Abdel Aziz Rantisi has the reputation of being a hard liner, strongly opposed to negotiation.

"We will fight them everywhere. We will hit them everywhere. We will chase them everywhere. We will teach them lessons in confrontation," Rantisi said.

Israel is already familiar with the new leader. He was the target of a botched Israeli assassination attempt last June.

But Israeli officials are talking just as tough. They say assassinations of militant leaders will continue. Internal Security Minister Tsahi Hanegbi said, "Everyone is in our sights. There is no immunity to anyone." The threat suggests Palestinian president Yasser Arafat could be targeted next.

Meanwhile, busloads of mourners arrived in Jerusalem Tuesday, to pay final respects to Sheik Ahmed Yassin. "I'm very upset because I lost him," says Yassin's wife, "May God damn those who led to his death... and punish them."

Homage was also paid at Gaza hospitals; several mothers named their newborn sons Yassin to honour the slain leader.

Meanwhile, Yassin's assassination continues to have international reverberations. The UN Commission on Human Rights will vote Wednesday on a resolution strongly condemning the "tragic assassination" of Yassin and "extra judicial executions" by the Israeli army against Palestinians.

American officials have said Washington was "deeply troubled" by the assassination, but in his first personal response to the assassination Tuesday, President George Bush said Israel had the right to defend itself.

"Israel has the right to defend herself from terror, and, as she does so, I hope she keeps consequences in mind," Bush said.

The assassination received wide support in Israel, where 60 per cent said killing Yassin was the right thing to do, according to a poll published in Tuesday's Hebrew daily Yediot Ahronot. Thirty-two per cent said the assassination was wrong.

One of those Israelis is Rami Elhanan. Even though his 14-year old daughter was killed by a Hamas suicide bomber, he says revenge will only widen the conflict. "We have to stop killing each other and we have to start talking to one another. It's the only way out. No one will win this war."

But pleas for peace are going unheeded. Early Wednesday, residents said dozens of Israeli tanks entered a refugee camp in southern Gaza. Israeli officials said they were trying to clear an area used by Palestinian gunmen.

Hours earlier, Israeli gunboats opened fire off the coast of Gaza, targeting fishing boats and piers, witnesses said. No one was hurt. The Israeli military said the gunboats fired at a suspicious object.

Also late Tuesday, an armed Palestinian was killed as he approached a Jewish settlement in Gaza, army radio reported.