At least eight Palestinians were killed, Wednesday, and more than 40 others injured, as Israeli forces launched a major military operation in the northern Gaza Strip. One Israeli soldier was also killed in the operation. Israel's security cabinet met to discuss the operation, but decided against expanding their offensive into other parts of the Gaza Strip.

About 40 armored vehicles and bulldozers moved into Beit Hanoun, near Israel's southern border with the Gaza Strip, early Wednesday. They were demolishing structures that Israel says were being used by Palestinian militants to launch rockets into Israel.

In one of the biggest military operations so far in Israel's four-month incursion in Gaza, helicopter gun ships carried out numerous air strikes in the area. Israel says several militants were killed in the strikes.

Speaking to journalists after Israel's security cabinet decided not to send large numbers of troops into other parts of Gaza, Israeli Defense Minister Amir Peretz said Wednesday's operation was designed to hit rocket launching sites.

Peretz said Israel has specific military objectives in Gaza and does not intend to reoccupy the territory.

Israel withdrew its forces and settlers from the Gaza Strip, last year. Since then, Israeli forces have carried out air strikes in Gaza, in response to Palestinian rocket attacks against towns in southern Israel. In late June, Israeli ground forces moved back into Gaza after an Israeli soldier was kidnapped by Palestinian militants.

A statement from Hamas, Wednesday, says Israel's current ground operations would have a "negative influence" on negotiations aimed at achieving a prisoner swap - expected to involve the release of hundreds of Palestinian prisoners in exchange for the Israeli soldier. A Hamas delegation is in Cairo this week for talks with Egyptian officials on the issue.

Meanwhile, the leader of Hezbollah, Sheikh Hassan Nasrallah says his organization, which is holding two Israeli soldiers, is involved in indirect negotiations with Israel over a prisoner exchange.

Nasrallah said, so far, the meetings have been serious and positive, but he gave no indication about any imminent breakthrough.

Israel and Hezbollah fought a 34-day war, earlier this year, after Hezbollah militants attacked an Israeli border post and abducted the two soldiers. More than 1,000 Lebanese, mostly civilians, and more than 150 Israelis died before a United Nations-brokered ceasefire went into effect, August 14.