* Efforts proceed to secure permanent ceasefire
* Israel keeps focus on militant tunnels in Gaza
* Tensions high in West Bank after deadly clashes
* 940 Palestinians killed in Gaza since July 8
By Nidal al-Mughrabi and Maayan Lubell
GAZA/JERUSALEM, July 26 (Reuters) - Palestinians in the Gaza Strip poured into the streets on Saturday to recover their dead and stock up on food supplies after a 12-hour humanitarian truce agreed by Israel and Hamas took hold.
Women in Beit Hanoun wailed as medics pulled three dead relatives from a home struck overnight by an Israeli air strike. Near Khan Younis, 18 members of a family died from tank shelling shortly before the truce began, the Gaza Health Ministry said.
Gaza health officials said rescue workers have so far pulled out 40 bodies from under the rubble since the truce began.
Israel's military pledged to hold fire for 12 hours from 8 a.m. (0500 GMT) but press on searching for tunnels used by militants. The Islamist group Hamas, which dominates Gaza, said all Palestinian factions would abide by the brief truce.
U.S. Secretary of State John Kerry has been spearheading international efforts to end 19 days of conflict in which 940 Palestinians, many of them civilians, have been killed. The diplomatic push was to continue on Saturday in Paris.
Israel said two more of its soldiers were killed in pre-truce fighting Gaza, bringing the army death toll to 37 as troops battled militants in tiny Mediterranean enclave that is home to 1.8 million Palestinians. Three Israeli citizens have also been killed by rockets fired from Gaza.
Residents of Beit Hanoun in the northern Gaza strip walked through destroyed streets lined with damaged houses and entire buildings reduced to rubble. Some who had not seen each other for days embraced as they surveyed the wreckage around them.
"We lived through a night of horror. The shelling was all around our house," said Hanan al-Zaanin, standing with four of her children outside their home in Beit Hanoun, an area which has seen fierce fighting.
Many of Beit Hanoun's 30,000 residents had fled the area. "We hope the calm lasts and they find a solution so fighting ends. We are afraid for our children's safety," she said, adding she will not leave her home. "There is no place to go."
Israeli tanks stood by as people searched through the debris for their belongings, packing whatever they could, blankets, furniture and clothes in to taxis, trucks, rickshaws, and donkey carts before fleeing the town.
Fighting continued until the truce took hold. Militants fired a barrage of rockets out of Gaza, triggering sirens across much of southern and central Israel. No injuries were reported and the Iron Dome interceptor system shot down some missiles.
Minutes after the truce began, many Gaza residents rushed out of their homes and lined up outside banks to withdraw cash so they could stock up on supplies.
Diplomats will pursue efforts to secure a ceasefire in Paris on Saturday, with France hosting officials from the United States, Britain, Germany, Italy, the European Union, Turkey and Qatar, a French diplomatic source said.
Kerry met on Saturday with Turkish Foreign Minister Ahmet Davutoglu in Paris, officials said, to continue crafting a ceasefire proposal.
Israel, which began its offensive on July 8, on Friday rejected international proposals for an extended ceasefire, a government source said. But Kerry said in Cairo that no formal proposals had yet been put forward.
He said there were still disagreements on the terminology, but he was confident there was a framework that would ultimately succeed and that "serious progress" had been made, although there was more work to do.
Israel's and Hamas's positions are still far apart.
Hamas wants an end to an Israeli-Egyptian blockade of Gaza before agreeing to halt hostilities. Israeli officials said any ceasefire must allow the military to carry on hunting down Hamas's tunnel network that criss-crosses the Gaza border.
Israel says some of the tunnels reach into Israel and are meant to carry out attack on Israelis. Other underground passages serve as weapon caches and Hamas bunkers.
The Gaza turmoil has stoked tensions in east Jerusalem and the occupied West Bank, some of which U.S.-backed Palestinian President Mahmoud Abbas governs in uneasy coordination with Israel.
Medics said eight Palestinians were killed in incidents near the cities of Nablus and Hebron on Friday, including one shooting that witnesses blamed on an apparent Jewish settler.
On Thursday night, 10,000 demonstrators marched in solidarity with Gaza near the Palestinian administrative capital Ramallah, a scale recalling mass revolts of the past.
Protesters surged against an Israeli army checkpoint, throwing rocks and Molotov cocktails, and Palestinian medics said one was shot dead and 200 wounded when troops opened fire.
Abbas's Palestine Liberation Organization called for more demonstrations in the West Bank and said it was at the same time working to secure a cease-fire deal. (Additional reporting by Arshad Mohammed in Paris; Writing by Maayan Lubell; Editing by Tom Heneghan)