CAIRO - Egypt's Islamist-led parliament reconvened on Tuesday in an open challenge to the generals who dissolved the assembly last month, stirring up tensions with the military just 10 days into Mohamed Mursi's presidency.

Mursi, the first civilian president to take office after six decades of military men in power, recalled the assembly on Sunday. The body, dominated by Mursi's Muslim Brotherhood group and other allies, was dismissed by the army in line with a court ruling issued days before Mursi's election.

Shortly before parliament speaker Saad al-Katatni opened the session, the United States urged all sides to engage in talks to safeguard the political transition in Egypt, a close US ally in the three decades under ousted Hosni Mubarak's rule.

"I invited you to convene in accordance with the decree issued by the president," said Katatni, who like Mursi hails from the Brotherhood. "I would like to confirm that the presidential decree does not violate the court order."

The dispute is part of a broader power struggle which could take years to play out. It pits the Brotherhood, which was repressed by Mubarak and his predecessors, against the generals seeking to keep their privileges and status and a wider establishment still filled with Mubarak-era officials.

The parliament was elected over the course of six weeks beginning in November, under a complex voting procedure which the court later ruled was unconstitutional, declaring the lower house void.

The then-ruling military said that meant the parliament had to be dissolved, but Mursi's supporters say it should still be allowed to work until early elections are held after a new constitution is passed.

On Monday the army defended its action to dissolve parliament and, in an apparent swipe at the president, said it was confident "all state institutions" would respect the constitution and the law.

Nevertheless, the army did not take any steps to prevent lawmakers from entering parliament.

After meeting to discuss Mursi's decree, the supreme court said on Monday its decisions were final and binding. It has announced it will hear challenges to the presidential decree's constitutionality on Tuesday.

Speaking in Hanoi on a tour which will include Egypt later this month, US Secretary of State Hillary Clinton called for talks to resolve any differences.

"We strongly urge dialogue and concerted effort on the part of all to try to deal with the problems that are understandable but have to be resolved in order to avoid any kind of difficulties that could derail the transition that is going on," she told a news conference.

As well as riling the army and judiciary, Mursi's recall of parliament raises tensions between the Brotherhood - the biggest winners so far in Egypt's political transformation - and liberal and other groups concerned at what they see as an Islamist power grab.

The Brotherhood says it is seeking a way to comply with the court's ruling that would not require parliament to be dissolved. After his short address to parliament, Katatni said lawmakers would discuss how to implement the court's ruling.

"We always respect the judiciary and we confirm that what we are discussing today is the mechanism to implement these court rulings," he said.

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