NEW YORK - World shares rebounded and oil prices fell on Tuesday on news of a possible Egyptian-brokered cease-fire in the Gaza Strip, but Israel later said an agreement was still not in place, sending US stocks lower.

World equity markets turned positive after a Hamas official said a cease-fire was expected to take effect later in the day, although Israel said no deal had been reached.

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Wall Street subsequently slipped back into negative territory, pulled lower by comments from Federal Reserve Chairman Ben Bernanke, who said the US economy faced a series of "headwinds." He cited damage to the US housing sector and mortgage markets, and a sharp tightening in credit.