Israel is expanding military operations into southern Gaza, putting at risk hundreds of thousands of Palestinians escaping the north as US officials grow increasingly uneasy about the war’s toll on civilians.

Iranian-backed Houthi rebels claimed they targeted “two Israeli ships” in the Red Sea, part of a series of attacks against commercial vessels in international waters on Sunday during which the US said one of its destroyers shot down three drones.

Israel’s government plans to offer whatever financial support and other assistance is needed to protect the country’s technology startup industry from the impact of the war with Hamas, according to the head of the Israel Innovation Authority.

Read more on business and the Israel-Hamas war

• War with Hamas is tormenting businesses key to Israel’s economy
• Bank of Israel puts war cost at $53bn in fullest tally yet
• Israeli businesses gather steam as shock of conflict eases
• Israel’s $48bn war bill leaves its fate with bond markets

Turkey warns Mossad not to kill Hamas operatives on its soil

Turkey warned Israel’s spy agency not to try to kill members of Hamas on its soil, using backchannels to convey the message following reports of plans to assassinate leaders of the Palestinian militant group overseas.

A senior Turkish intelligence official, speaking on condition of anonymity, said the MIT intelligence agency told Israeli counterparts at Mossad that such unilateral moves would have serious repercussions for bilateral ties. The official spoke on condition of anonymity, citing the sensitivity of the issue.

The matter flared up after Israeli public broadcaster Kan cited a recording of the internal security service, Shin Bet’s leader, Ronen Bar, to report on plans to target Hamas leaders in Palestinian territories as well as in Lebanon, Turkey and Qatar. Some of the Hamas leaders, including Ismail Haniyeh, are known to visit and stay in Istanbul, Turkey’s largest city.

The warning signals fresh tensions between the two countries, whose relationship has been strained since a public spat in 2009 between then Prime Minister Recep Tayyip Erdoğan and Shimon Peres, Israel’s president at the time.

Erdoğan, who’s currently Turkey’s president, has defended Hamas — designated a terrorist organisation by the US and European Union — as a group fighting for Palestinian rights.

Israel has been at war with Hamas for almost eight weeks.

Israel to back its technology industry through war, says agency head

Israel’s government plans to offer whatever financial support and other assistance is needed to protect the country’s technology startup industry from the impact of the war with Hamas, according to the head of the Israel Innovation Authority.

The publicly funded agency will this month roll out $100-million in conditional grants to early-stage startups if they can get matching funds from the private sector in whatever form, Dror Bin, its chief executive officer, said in an interview.

Within weeks, it hopes to conclude talks with the government that will start a programme to encourage large institutional investors to plough money into venture capital companies that have held back on funding due to the uncertainty caused by the war, he said. Incentives may include a government guarantee on lending to absorb any losses and an “upside booster” to increase profits from successful investments.

“The Israeli government is determined to do whatever is needed to make sure that Israeli tech will continue to grow and we are determined to make sure that all assets are protected and we will come out of it stronger,” Bin said.

Israel’s technology industry is key to the economy, accounting for about one-fifth of gross domestic product and about half of exports. The pledge of assistance comes as interest rates are already at a 17-year high and amid the uncertainty brought by the war that started on 7 October when Hamas militants invaded Israel from Gaza.

Israel’s wider war has US cautioning of ‘strategic defeat’

Israel was expanding military operations into southern Gaza, putting at risk hundreds of thousands of Palestinians escaping the north as US officials grew increasingly uneasy about the war’s toll on civilians.

Southern Gaza was hit by airstrikes overnight, when the Israeli military struck about 200 targets, including weapons depots used by Hamas. The attacks came hours after Israel Defense Forces urged those who fled south to evacuate again.

Read more: Israel’s war aims move south with Hamas leadership in crosshairs

The fatalities in Gaza — standing at around 15,500 according to the Hamas-run health ministry — have spurred increasingly vocal and public warnings from top US officials that Israel should do more to keep Palestinians safe.

Over the weekend, US officials, from Secretary of Defense Lloyd Austin to Vice-President Kamala Harris, said the civilian cost of the war was becoming too high.

A continuation of the war in Gaza risks escalation elsewhere. A US Navy ship responded to a flurry of drone and missile attacks against commercial ships operating in the Red Sea, blaming Iran-backed Houthi militants in Yemen.

“These attacks represent a direct threat to international commerce and maritime security,” US Central Command (Centcom) said in a statement. “We also have every reason to believe that these attacks, while launched by the Houthis in Yemen, are fully enabled by Iran.”

Privately, Israeli and US officials said they see eye-to-eye on IDF’s main objective to dismantle Hamas. The operation “will be as thorough in the south as it has been in the north” of Gaza, the IDF chief of staff, Lieutenant-General Herzi Halevi, said. “It will be as fierce, with no lesser results.”

Other US and Israeli officials said the US wasn’t against the operation in southern Gaza, but that it was asking for the creation of safe zones to limit casualties. Those officials asked not to be identified, citing the sensitivity of the matter.

“The US has been absolutely clear and unwavering” in its support, said Eylon Levy, a spokesperson for the Israeli government. “We are very close to totally destroying two Hamas brigades in northern Gaza and the fighting is going to continue in the south,” he said at a press briefing on Monday.

Many nations have warned Israel not to use the overwhelming force in the south as it did in the north, where it levelled much of Gaza City.

“We are trying to be as surgical as we can be in a very difficult combat situation,” Mark Regev, a senior adviser to Netanyahu, told the BBC on Sunday. He added that casualty estimates from Gaza health authorities “need to be taken with a grain of salt”.

Yet expanding combat in the south is more difficult now because of the displacement of some 1.8 million people, many of whom fled there to avoid the earlier fighting in the north, according to figures by the United Nations.

Skirmishes also continued with Hezbollah, another Iran-backed armed group in Lebanon to Israel’s north. Lieutenant-Colonel Jonathan Conricus, an IDF spokesperson, said early on Monday that Israel was confronting “quite escalatory” actions by Hezbollah on the country’s northern border with Lebanon.

US warns Iran-backed Houthis after Red Sea shipping attacks 

Iranian-backed Houthi rebels claimed they targeted “two Israeli ships” in the Red Sea, part of a series of attacks against commercial vessels in international waters on Sunday during which the US said one of its destroyers shot down three drones.

The USS Carney responded to distress calls from three ships over the course of the day while patrolling in the Red Sea, two of which matched the names of carriers the Yemen-based Houthis said they had targeted, Centcom said in a statement. No casualties were reported and while each drone was headed toward the Carney, it wasn’t clear that the warship was the target, according to Centcom.

The US military blamed the Houthis, “fully enabled by Iran,” for the attacks, saying they “represent a direct threat to international commerce and maritime security”.

“The United States will consider all appropriate responses in full coordination with its international allies and partners,” Centcom said.

The attacks were the latest in a series against vessels since the rebels in Yemen issued a threat against ships with ties to Israel last month, calling them “legitimate targets”.

The Houthis said the Bahamian-flagged bulk carrier Unity Explorer was struck by a missile and the Panama-flagged container ship Number 9 was hit by a naval drone. The ships had “ignored warning messages from the Yemeni naval forces”, according to the statement.

According to Centcom’s account, the Unity Explorer was struck by a missile fired from Houthi-controlled areas in Yemen, sustaining minor damage. Later, the Number 9 was struck by a missile from Houthi-controlled areas, reporting damage but no casualties.

An hour later, the Sophie II, a Panamanian-flagged bulk carrier, sent a distress signal saying it had been struck by a missile, which the USS Carney reported as causing no significant damage. The US destroyer also shot down a UAV headed in its direction while en route to aid the Sophie II, Centcom said. DM