Israeli hostages might be released as early as Saturday under a US plan to end the war in Gaza and the country's military will complete the first part of a partial withdrawal from the enclave within 24 hours of the deal being signed.

The signing of the agreement on the first stage of US President Donald Trump's initiative for Gaza is expected to take place at noon, Israel time, on Thursday (8pm AEDT), a source briefed on details of the agreement said.

Israelis and Palestinians rejoiced after Trump announced that a ceasefire and hostage deal was reached under the first phase of his plan to end a war in Gaza that has killed more than 67,000 people and reshaped the Middle East.

A day after the second anniversary of Hamas militants' cross-border attack that triggered Israel's devastating as

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