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Palestinians on Friday morning fired an anti-tank rocket on Friday morning at school bus carrying children outside the southern Gaza Strip settlement of Kfar Darom, shaking the fragile lull in violence. The rocket failed to hit the bus.

A mortar shell also hit a Gush Katif settlement. No damage or casualties were reported in either case.

Palestinian militants in the Gaza Strip fired four Qassam rockets at the southern Israeli town of Sderot predawn Friday. The Magen David Adom ambulance service said that several people had been treated for shock.

Three of the rockets landed in an open field. One hit a building in the center of the Negev town, which was empty at the time due to renovation works.

The "Red Dawn" early warning system apparently did not work. Sderot residents last night talked of the return of fear to their lives.

Sderot resident Moshe Shachor told Army Radio that even after Mahmoud Abbas was elected Palestinian Authority Chairman, Sderot residents did not believe to the promises of quite.

"Clearly, the solution for living in Sderot is [the Israel Defense Forces] sitting in the Gaza Strip," Shachor said.

Since the de facto ceasefire between Israel and the Palestinian Authority, a number of Qassam rockets have been fired at Sderot causing no damage or injury.

David Baker, an official in the Prime Minister's Office, charged that the Palestinian Authority is freeing suspects and "allowing them to perpetrate additional acts of terror. This has to stop."

Palestinian security officials promised to investigate.

In the West Bank, Palestinian police arrested three Palestinians on Friday, along with an Israeli, on suspicion of stealing an Israeli taxi and attacking the driver.

The taxi driver had been taking the four from Be?er Sheva to upper Betar the previous night. The passengers allegedly brandished a knife, threatened the driver, and sprayed him with tear gas, forcing him to leave the cab, then began driving towards Hebron. The driver was lightly wounded.

Palestinian police located the taxi and the suspects near a Hebron hospital and arrested them.