Thousands attended the burials today of the two Israeli soldiers returned in a prisoner exchange with Lebanese guerrillas.

Israel’s government gathered today to vote on an emotionally charged deal to swap a notorious Lebanese prisoner for two Israeli soldiers captured two years ago – and declared for the first time to be dead.

PALESTINIAN militants fired 50 rockets and mortars toward Israel yesterday, who responded with airstrikes in Gaza, just hours before a truce was to take effect, illustrating how fragile the cease-fire between Israel and Hamas would be.

ISRAEL’S prime minister Ehud Olmert sought to assure Palestinian president Mahmoud Abbas yesterday that peace talks would not be affected by a corruption scandal that could force the Israeli leader from office.

Hamas militants drove two booby-trapped military vehicles into an Israeli border crossing with Gaza under the cover of morning fog today, detonating one and wounding 13 soldiers in one of Hamas’ most ambitious attempts to target Israelis since Israel’s pullout from Gaza in 2005.

Israeli prime minister Ehud Olmert has approved new construction in a West Bank settlement outside Jerusalem, a Construction Ministry official said today, just days after a Palestinian man opened fire on a Jerusalem religious seminary, killing eight students, most of them teenagers.

Hezbollah possesses sophisticated weapons that could be used to target Israel, a retired Lebanese army general said today, a day after the militant group’s leader promised that Israel would face a “big surprise” if it invaded Lebanon.

Iran’s hard-line President Mahmoud Ahmadinejad today warned Israel it would be uprooted if the Jewish state attacked Lebanon in the coming summer.

Israeli warplanes sent missiles slamming into a car carrying Hamas militants and a consignment of weapons before dawn in Gaza today.

Efforts to revive Israeli-Palestinian peacemaking will shift into higher gear in the coming week, with Israeli Prime Minister Ehud Olmert travelling to Jordan and his foreign minister heading to Cairo to discuss a sweeping Arab peace proposal, an Israeli official said today.

Efforts to revive Israeli-Palestinian peacemaking will shift into higher gear in the coming week, with Israeli Prime Minister Ehud Olmert travelling to Jordan and his foreign minister heading to Cairo to discuss a sweeping Arab peace proposal, an Israeli official said today.

Nobel laureate Desmond Tutu today said Israel has refused him permission to lead a fact-finding mission to investigate Israeli-Palestinian violence.

Israel has blocked a UN fact-finding mission to the Gaza Strip that was to be led by Nobel Laureate Desmond Tutu, officials said today.

Israeli and Palestinian officials were today working to expand a ceasefire to the West Bank, as the Gaza truce which took effect Sunday appeared to be holding.

Israeli defence minister Amir Peretz today said a dormant Saudi initiative for Mideast peace could be a “basis for negotiations,” indicating a new basis for talks with the Palestinians after years of stalemate.

Hamas officials today gave Palestinian President Mahmoud Abbas the go-ahead for negotiations with Israel, a major shift in the militant Islamic group’s position toward the Jewish state as it worked to end its international isolation.

Palestinian President Mahmoud Abbas and Prime Minister Ismail Haniyeh today agreed that their moderate Fatah and militant Hamas parties would form a coalition government – a move the Palestinians hope would ease crippling international sanctions.

UN Secretary General Kofi Annan today called on Israel to end its air and sea blockade of Lebanon and appealed for the quick release of two Israeli soldiers captured by Hezbollah guerrillas.

Muslim leaders demanded an immediate cease-fire between Israel and Hezbollah yesterday at an emergency meeting in Malaysia, where Iran’s hard-line president said the solution was the obliteration of the Jewish state.

Iranian President Mahmoud Ahmadinejad said today the solution to the Middle East crisis was to destroy Israel, state-media reported.

Israel has hit hundreds of targets in Lebanon since last night, as part of its effort to force the release of two soldiers captured by Hezbollah guerrillas, a top Israeli general said today.

Iran successfully test-fired a missile that can avoid radar and hit several targets simultaneously using multiple warheads, the military says.

Hamas formally took power today, with the Palestinian president swearing in its 24-member Cabinet, including 14 ministers who served time in Israeli prisons.

Hamas says it has completed the formation of its government without bring in moderate parties, a step that looked likely to only increase the chances of international isolation.

THE Palestinians’ incoming prime minister suggested Hamas could one day make peace with Israel, but undercut his statement by saying his militant group wouldn’t disarm or recognise Israel unless it recognised a Palestinian state within boundaries the Israelis reject.

Israel sealed its crossings with the Gaza Strip today after a Palestinian suicide bomber killed five people.

A PALESTINIAN suicide bomber standing in line at a crowded falafel stand blew himself up yesterday in the central Israeli town of Hadera.

A top Middle East envoy has criticised Israel in especially tough language for moving too slowly on negotiations to open Gaza’s borders, saying the country is behaving almost as if the withdrawal from the Gaza Strip never happened.

Israel has suspended all contacts with the Palestinian Authority in response to a West Bank shooting that killed three Israelis, the Israeli Foreign Ministry spokesman said today.

The Palestinian parliament today decided to appoint a committee of politicians to investigate what killed long-time leader Yasser Arafat, alleging Israel involvement.

A truck carrying masked militants and two home-made rockets blew up at a Hamas rally in Jebaliya, Gaza, today, killing at least 10 Palestinians and wounding 85, hospital doctors said.

ISRAEL and the Palestinian Authority yesterday said they feared al-Qaida terrorists will infiltrate Gaza through the Gaza-Egypt border.

Israel today closed the vital Gaza-Egypt border crossing just days before completing its military pullout from the coastal strip.

A mysterious blast after nightfall tonight levelled a building in Gaza City, killing four people and wounding at least 30, residents and hospital officials said.

THE 19-year-old who killed four Israeli Arabs on a bus had deserted the army to protest at Israel’s upcoming withdrawal from Gaza, taking refuge in a militant Jewish settlement with his military-issued rifle.

Palestinian officials said today they have reached a tentative agreement to absorb about 700 gunmen in the West Bank city of Nablus into the Palestinian security services, pushing forward with a campaign aimed at disarming rogue militants roaming the Palestinian areas.

Amnesty International today accused Israeli soldiers operating in the Palestinian territories of committing war crimes, including unlawful killings, torture, destruction of property, obstruction of medical assistance and targeting of medical personnel.

An Israeli army investigation found that troops apparently killed three Egyptian soldiers they mistook for Palestinian militants along the Gaza-Egypt border today.