JERUSALEM -- Jittery Israeli civilians shot and killed an Arab-American involved in a fatal traffic accident yesterday as a mood of anger and pessimism settled over Israel after Sunday's terrorist bus bombings.
Public support for Prime Minister Shimon Peres, who is beginning a campaign on a platform of peace with Palestinians, dropped sharply after the twin attacks that killed 27 people, including two suicide bombers, in Jerusalem and Ashkelon on Israel's Mediterranean coast.
Mr. Peres imposed a military closure of Palestinian areas and yesterday announced a "war" on Palestinian terrorists. He hinted that Israeli agents will assassinate Palestinian radicals. The Islamic fundamentalist group Hamas announced that Sunday's bombings were in retaliation for such an assassination.
"The best of our people in the security services will work to locate and eradicate Hamas members," Mr. Peres vowed. "We will take all appropriate means to strike at terrorists everywhere, both before and after they commit their criminal actions."
Israeli police said yesterday that three Yeshiva students jumped to the conclusion that a terrorist was behind the wheel of a car that ran into a bus stop in Jerusalem, killing a Jewish woman. According to Eric Bar-Chen, a police spokesman, bystanders shot and killed the driver, identified as Ahmed Abdul-Hamid Hamida, 36, a resident of California who had been staying with relatives in a West Bank village outside Ramallah since July.
His rental car apparently skidded on wet pavement, police said. Israel radio later said the three students were released. The station noted that each gave a different version of the shooting.
"It's possible that even if policemen were there, they would have acted the same way," Mr. Bar-Chen said, noting the tension after Sunday's bombings. "You have to make a split-second decision."
Investigators said yesterday that they believed suicide bombers, perhaps dressed as Israeli soldiers, set off Sunday's bomb on a Jerusalem bus and another at a Ashkelon hitchhiking post. It was the deadliest day for Israelis since the signing of the 1993 peace accord with the Palestinians.
Hamas said the blasts were in retaliation for the Jan. 5 assassination of Hamas bomb-maker Yehia Ayyash with a booby-trapped telephone, allegedly the work of Israeli agents.
Throughout the day in Israel, funerals were held to bury the dead from Sunday's bombings, and along with them, a measure of the recent optimism about peace with the Palestinians.
It had been six months since the last of a string of bus bombings in which scores of Israelis were killed. The turnover of six West Bank cities to the Palestinians had gone without major problems. The Palestinian election was deemed a reasonable success, and many skeptical Israelis were beginning to believe the peace process might work.
But yesterday, many of the old divisions in Israeli society resurfaced. Right-wing groups clamored for an end to the peace process, while Mr. Peres' supporters argued that a change in course only would lead to more attacks.
With elections scheduled May 29, the bombings could be disastrous politically for Mr. Peres and his government. Many Israelis blame the bombings on the peace process, despite his arguments that such bombings have occurred for years. Mr. Peres' lead in opinion polls fell from 15 percentage points to 3 points after the bombings.
In a speech yesterday to the Knesset, or parliament, Mr. Peres struck a tough tone. He said he would issue a "list of operational demands" to insist that Yasser Arafat's Palestinian National Authority pursue a tougher crackdown of Muslim militants. Mr. Arafat's police made sweeping arrests of 30 to 60 alleged Hamas supporters yesterday, according to reports from the Gaza Strip.
Mr. Peres said the Palestinian Authority "must decide to disarm the terrorists" and "outlaw those who act contrary to the law."
Israel will pressure other countries, presumably including the United States, to ban Islamic fund-raising charities that "camouflage [their] true nature.
"They raise funds abroad, supposedly to aid orphans, but in fact they use the contributions to purchase explosives," the prime minister said.
Mr. Peres said the military closure of the Palestinian areas "will continue as long as is required from a security standpoint."
Palestinian officials bitterly protested the closure, which prevents about 30,000 workers from working in Israel and cuts into the main source of income for Palestinians. The officials say it is mass punishment and breeds bitterness from the economic hardship.
"Closures will only increase frustration, which builds up violence," said Ahmed Korei, a Palestinian negotiator. "Hungry people react violently."
Israeli Foreign Minister Ehud Barak dismissed the complaints, saying Israel should enforce the closure despite the economic effects on Palestinians. He said closures had helped prevent attacks.
"We must separate from the Palestinians," he said. "Let them build their own entity."