(Updates with stocks, shekel in 12th paragraph.)
Aug. 22 (Bloomberg) -- Hamas said it reached an informal accord with Israel to halt escalating violence and the Israeli military said rocket fire on southern towns decreased by more than three-quarters today.
“Hamas has reached an informal, implicit agreement with Israel,” Razi Hamed, a senior Hamas official in Gaza, said by telephone. “A preliminary accord was reached with the Palestinian factions on the condition that Israel stop its aggression,” Yasser Othman, Egypt’s envoy to the West Bank, said by phone. “The next 24 hours will be a test.”
Eight mortar shells and rockets from Gaza hit Israel today, down from 37 yesterday, when Israel’s air force struck Gaza three times, an army spokeswoman said, speaking anonymously in accordance with regulations. There were no air strikes today, she said.
The latest round of violence was the worst bloodshed since at least April. It began on Aug. 18, when gunmen killed eight Israelis near the resort city of Eilat. Fourteen people were killed in subsequent Israeli airstrikes on Gaza and one person in Israel died during a rocket attack. Hamas has said it wasn’t involved in the Aug. 18 attacks.
Israeli Prime Minister Benjamin Netanyahu’s spokesman, Mark Regev, declined to comment on the cease-fire.
“The objectives of the operation were to prevent launching of rockets on Israeli cities and to target those directly involved in attacks on Israelis,” he said.
The Islamic Hamas movement seized control of Gaza from Palestinian Authority President Mahmoud Abbas’s Fatah party in 2007, ending a partnership government a year after winning parliamentary elections. The group refuses to recognize Israel or any prior agreements signed with it and is considered a terrorist organization by Israel, the U.S. and the European Union.
“No one wants a major escalation now, not Israel, not Hamas, and not the government of Egypt,” said Jonathan Spyer, a political scientist at the Interdisciplinary Center Herzliya outside Tel Aviv. “Hamas isn’t looking to give up Gaza any time soon, and that means it needs to keep Gaza fairly quiet.”
The violence comes amid Israeli concern that Egyptian security forces have been losing control of the border area since the February ouster of President Hosni Mubarak. Natural- gas supplies to Israel, which receives about 40 percent of the fuel from Egypt, were disrupted after four attacks on the pipeline network between Feb. 5 and July 12.
Egypt has demanded that Israel apologize for the deaths of three Egyptian policemen who were killed on Aug. 18 after militants crossed the southern border and opened fire on cars and buses. Israel is investigating the possibility its forces inadvertently killed the Egyptians while shooting at the attackers, said a military officer who declined to be identified, citing regulations.
Israel and Egypt signed an accord in 1979 that called for Israel to withdraw from Sinai, which it had seized in a 1967 war. The withdrawal was completed in 1982.
The benchmark TA-25 index was up 2.8 percent to 1109.34 at the 4:30 p.m. close in Tel Aviv, its highest since Aug. 4. The shekel strengthened less than 0.1 percent and was trading at 3.5755 shekels to the dollar at 4:30 p.m. in Tel Aviv.
Israel’s credit-default swaps, or the cost of insuring government debt against non-payment for five years, rose to 160 at 9 a.m. in New York, the highest level in more than a week, according to London prices from CMA, which is owned by CME Group Inc. and compiles prices quoted by dealers in the privately negotiated market.
--With assistance from Fadwa Hodali in Cairo and Tal Barak Harif in New York. Editors: Jennifer M. Freedman, Louis Meixler.
To contact the reporters on this story: Gwen Ackerman in Jerusalem at firstname.lastname@example.org; Calev Ben-David in Jerusalem at email@example.com
To contact the editor responsible for this story: Andrew J. Barden at firstname.lastname@example.org