Israel targets 'terror factory'

Israeli forces are searching for alleged car bombers

Israeli attack helicopters have fired several missiles to destroy a metal workshop in the Gaza Strip.

Military officials said they suspected the factory near the Palestinian police station at Khan Younis was making weapons for militants.

Main Gaza roads have been closed in an Israeli security operation

The overnight operation came hours after two other incidents in Gaza left two Israeli soldiers and a Palestinian fighter dead.

Two more Palestinians were killed in the West Bank town of Jenin as violence increased in the hours before the start of the Jewish New Year on Friday night.

On Thursday, the Israelis discovered and destroyed a 600-kilogramme (1,300-pound) car bomb - one of the largest they have found. It is believed the bomb was being smuggled towards an Israeli town.

There were no casualties from the Israeli attack on the Gaza foundry, carried out at night when no-one was inside.

Israel has attacked Palestinian factories before, saying they are used for making explosives, rockets and mortars for use in attacks against Israelis.

'Innocent production'

But the workshop's owner, Abu Khalil, told the Reuters news agency that only parts for electric generators were made.

"Why did they hit my foundry? I did nothing wrong," he said.

Israeli soldiers closed off main roads in Gaza on Friday to stop the transfer of weapons, officials said.

Israeli Foreign Minister Shimon Peres said finding the car bomb was a miracle

Earlier, a bomb exploded under an Israeli tank near the al-Maghazi refugee camp in the Gaza Strip, killing at least one Israeli soldier.

At least three others were wounded, the Israeli military said.

The Popular Resistance Committee - an umbrella group representing several Palestinian factions - said it was behind the attack.

Intifada anniversary

Another soldier died elsewhere in the Gaza Strip, near the Jewish settlement of Nitzanit, when a Palestinian militant fired at an Israeli army patrol before being shot dead himself.

Malek Grifat, 24, was named as the dead soldier. The al-Aqsa Martyrs Brigades, an armed group linked to Palestinian leader Yasser Arafat's Fatah faction, said it carried out the shooting.

A member of the al-Aqsa group was one of the two Palestinians shot dead in Jenin on Friday, residents said.

Security is being stepped up before the start of the two-day Jewish New Year holiday beginning at dusk.

Two years ago, a New Year visit by Israeli Prime Minister Ariel Sharon - then an opposition leader - to a shrine in Jerusalem's Old City built on a site sacred to Jews and Muslims, sparked the current uprising.