Delighted Palestinians in the West Bank and Gaza Strip took to the streets to celebrate the signing of a reconciliation deal between Hamas and Fatah.

As Hamas leader Khaled Meshaal sat down in Cairo to ratify the deal with president Mahmud Abbas, who heads the Fatah faction, more than 1,000 people turned out in Gaza City to show their support, with parallel demonstrations in the West Bank, according to a report in our sister newspaper Gulf Daily News (GDN).

In Gaza, the demonstrators marched through the city to gather at the Square of the Unknown Soldier, with people dancing in circles and letting off firecrackers as they cheered the deal aimed at ending years of division between the two movements.

Throughout the day and into the evening, the square and the surrounding streets were turned into a sea of coloured flags, most of them Palestinian.

But in a real sign of change, scores of people held up the yellow flag of Fatah, which has been banned in Gaza since the Islamists kicked the secular movement out of the territory in June 2007.

'This is the first time in four years I can hold a Fatah flag alongside a Palestinian flag,' said 20-year-old engineering student Mahmud Al Riati.

'Abbas stood up to Israel and he chose to continue the agreement with Hamas. He refused to give in to Israeli pressure and chose the Palestinian side,' he said.

Among Gaza's youth, the mood was overwhelmingly optimistic, despite the host of issues yet to be ironed out under the deal.

'This is the day that we've all been waiting for,' someone bellowed into a loudspeaker, praising the March 15 youth movement that organised mass demonstrations across the Palestinian territories some six weeks ago which played an important role in pushing the leadership to reach a deal.

'It is our liberation today,' he shouted, saying it was all down to the youth who suffered arrests and beatings as they repeatedly called for the two factions to reconcile.

The reconciliation deal envisages Hamas and Fatah working to put together an interim government of technocratic candidates unaffiliated with either faction, who will rule until presidential and legislative elections can be held within a year.

'They have all of the main issues to resolve but I think it will work.'

In the West Bank city of Ramallah, Palestinian prime minister Salam Fayyad described the signing of the deal as a 'very happy moment.'

'We've been waiting a long time for this to happen,' he said.

And Hanan Ashrawi, a senior member of the Palestine Liberation Organisation, said the agreement was 'an important step towards Palestinian statehood and lasting peace.'

In private, however, some political leaders were more circumspect. One official in Ramallah put the agreement's chances of success at '50/50', while another decried 'the lack of a clear vision' from Fatah and Hamas.