AMNA NAWAZ: Welcome to the "NewsHour."

It's been a day of joy in# Israel, a day of dread in Gaza,## and a day of warnings in Washington.

Israeli# troops last night rescued two hostages from## Hamas militants in Rafah in an operation that# Palestinian authorities say killed more than## 70.

Israel is now threatening to assault# Rafah, where it says Hamas leadership is## hiding and which is hosting more than# half of Gaza's 2.3 million residents.

But President Biden today warned Israel# that the displaced must be protected.

Nick Schifrin has our report.

NICK SCHIFRIN: As the Israeli military# lit the Rafah sky, on the ground,## special forces launched a rescue mission.# Israel said it raided an apartment complex## and traded fire with Hamas militants before# it could recover two hostages, 60-year-old## Fernando Marman and 7-year-old Louis Har, reunited# with family members after 128 days of captivity.

They're the second and third# hostages to be rescued,## and Israel called their release proof that# the military needs to maintain pressure.

REAR ADM. DANIEL HAGARI, Spokesperson,# Israeli Defense Forces: This rescue## mission underscores the importan.. NICK SCHIFRIN: Prime Minister Benjamin Netanyahu,## whose brother died freeing kidnapped Israelis# 48 years ago, called the rescue hi.. BENJAMIN NETANYAHU, Israeli Prime Minister# (through translator): I want to tell you## that the release of Louis and Fernando is on.. the most successful rescue operations# in the history of the state of Israel.

NICK SCHIFRIN: Rescue was facilitated by dozens of## airstrikes that the Hamas-run Gaza# Health Ministry said killed dozens.

Dr. Jamal al-Hams in blue tried to save the## wounded in the only available# facility, an overwhelmed tent.

DR. JAMAL AL-HAMS, Kuwaiti# Hospital: There is no big## capacity.

There is no ability of the#.. NICK SCHIFRIN: Today, in the operations# aftermath, family homes are reduced to rubble.

"PBS NewsHour" producer Shams Odeh: SHAMS ODEH: More than 10 houses was demolished,## as you see in the pictures.

Here, where the# Israeli command said that they released two of## the hostages here from Rafah,if you look# around me, you see all of the house had## been destroyed completely.

And there's a lot# of people killed here and displaced in Rafah.

NICK SCHIFRIN: Hamas said the Israeli operation# killed at least three other hostages and wounded## five more.

Israel says it can't confirm that and# accuses Hamas of lying about the hostages' fate.

Rafah is home to 1.3 million displaced# Gazans.

But Netanyahu has ordered the## Israeli military to develop plans to# move civilians and besiege the city,## where Israel says Hamas' leadership is hiding.# The international community is pushing back.

Top European Union diplomat Josep Borrell: JOSEP BORRELL, European Union Minister for# Foreign Affairs: Netanyahu have been asking## to the evacuation of 1.7 milli.. NICK SCHIFRIN: The U.N. full-fledged military incursion .. packed against the Egyptian border with# nowhere further to flee is terrifying.

NICK SCHIFRIN: Egypt has threatened to# suspend its 45-year-old peace treaty with## Israel.

And a senior administration# official said President Biden told## Netanyahu that moving the population# was a -- quote -- "precondition of an## operation" and it can't -- quote --# "proceed without a credible plan."

JOE BIDEN, President of the United States:# Many people there have been displaced,## displaced multiple times, fleeing the violence# to the north, and now they're packed into Rafah,## exposed and vulnerable.

They need to# be protected.

And we have also been## clear from the start we oppose any forced# displacement of Palestinians from Gaza.

NICK SCHIFRIN: Israel and the U.S.# believe about 100 hostages remain## alive in Gaza.

More than 100 gained freedom# in November thanks to a diplomatic agreement## between Israel and Hamas.

Progress# is being made for another release.

A senior administration official says the# framework is -- quote -- "pretty much now## in place" and the initial phase is actually# finished, but significant differences remain.

JOE BIDEN: The key elements of the deal are# on the table.

There are gaps that remain,## but I'm encouraging Israeli leaders# to keep working to achieve the deal.

NICK SCHIFRIN: Tomorrow, CIA Director Bill# Burns will resume negotiations in Cairo to try## and maintain diplomatic momentum before Israel# follows through on its threat to invade Rafah.

For the "PBS NewsHour," I'm Nick Schifrin.