A large-scale operation in the Gaza Strip has dropped to the back burner in recent days after an assessment within the defense establishment found that the daily border raids the IDF has been conducting have had an effect on Hamas's military capabilities, senior defense officials said Tuesday. Earlier in the day, eight Palestinian gunmen were killed and at least 10 wounded as IDF tanks and bulldozers, backed by IAF helicopters, swept into southern Gaza in the biggest operation there since Hamas's violent takeover in June. Fierce clashes erupted between IDF troops and gunmen who fired rocket-propelled grenades and mortar shells at the soldiers. Palestinians carrying land mines and other weapons dodged among houses in the southern Gaza town of Khan Yunis and maneuvered behind the tanks to fire at troops. Others took cover behind trees or covered themselves in leaves to camouflage themselves in open farmlands in the area of the fighting. IDF sources said the tanks had operated a little over one kilometer inside Gaza near a main road that connects Khan Yunis and Rafah. An RPG anti-tank missile was fired at a tank, lightly wounding four soldiers. Soldiers took over the rooftops of several homes and arrested about 60 people in house-to-house arrest raids, residents said. The army said this was a routine operation "against the terror infrastructure," and not indicative of a larger operation. Gaza terrorists routinely fire Kassam rockets and mortar shells at Israeli border communities and smuggle in weapons from Egypt. Defense Minister Ehud Barak said the operation had achieved "very important results" in the fight against the manufacture and firing of Kassam rockets and mortar shells. Speaking during a visit to a navy base in Haifa, Barak said that IDF operations like the one on Tuesday allowed Israelis to celebrate Hanukka and light candles in peace. While Barak has repeatedly said in recent weeks that Israel would ultimately have no choice but to launch a large-scale operation in Gaza, defense officials said Tuesday that the small raids were having an effect on Hamas and could be behind news reports that the terror group was interested in reaching a truce with Israel. "This is a long process, and it doesn't mean that there won't be a large-scale operation," one defense official said - stressing, however, that continuous military pressure on Hamas could also push Hamas to stop its attacks against Israel. Sources close to Hamas said the movement's leaders had all gone underground for fear of being targeted by Israel. Later Tuesday, two Kassam rockets fired from Gaza landed in open fields near Sderot. No one was wounded, and no damage was reported. Meanwhile, Hamas called on the Palestinian Authority to cancel the following day's peace talks with Israel in response to the IDF operation. A Hamas spokesman in Gaza said that it would be an "embarrassment" for a Palestinian representative to shake the Israelis' "blood-stained" hands. Palestinian officials complained that the military action, along with a new construction project in Jerusalem's Har Homa neighborhood, threatened to sabotage the fledgling peace talks. Palestinians said the construction project would dominate Wednesday's discussions. "The decision to build new housing units in Har Homa created a lot of problems for the credibility of the peace process," Palestinian negotiator Saeb Erekat said. Khaled Abu Toameh and AP contributed to the report.