The Free Galil Brigades and Group of Imad Mughniyeh and Martyrs of Gaza'' claimed responsibility for the attack.

The Soviet-made weapon has a longer range and is more lethal than the Qassam rockets primarily used by militants in Gaza.

``Israel will never allow terrorism to achieve its goals,'' Foreign Minister Tzipi Livni said in a statement after the Jerusalem attack. ``Israel is at the forefront of the struggle against terrorism and will continue to defend its citizens, who are exposed to this threat on a daily basis.''

Jerusalem Mayor Uri Lupolianski said it was ``a sad day'' and called on the government to complete the construction of a barrier to separate the city from the West Bank.

Hamas has ruled Gaza since ousting troops loyal to Palestinian Authority President Mahmoud Abbas and ending a partnership government with him. Abbas said yesterday he intends to resume peace talks with Israel. Hamas refuses to recognize Israel and rejects negotiations with the Jewish stat