West Bank Israeli troops and Palestinian gunmen exchanged heavy fire Thursday in downtown Ramallah after undercover Israeli forces tried to arrest fugitives in the city's vegetable market. Two Palestinians were killed and 25 were wounded.
Separately, a new round of factional fighting broke out between the rival Hamas and Fatah groups in the Gaza Strip, leaving two Palestinians dead.
Assailants also targeted three senior Hamas officials in the West Bank, kidnapping one, torching the car of a second and shooting in the air as a third emerged from a mosque, security officials said Thursday.
The Israeli arrest raid came as Israeli Prime Minister Ehud Olmert was meeting with Egyptian President Hosni Mubarak in the Red Sea resort of Sharm el-Sheik, Egypt, to find ways to restart Mideast peace talks that have been stalled for more than six years.
Israeli media reported that Mubarak would propose a regional peace summit involving Israel, the Palestinians, Egypt and Jordan, but Olmert's aides said they were unaware of such a proposal.