Biden Supports Two-State Solution, Netanyahu Anticipates Gaza Incursion, Macron Advises Caution To Israel

During a press conference at the White House with Australian Prime Minister Anthony Albanese on Wednesday, U.S. President Joe Biden expressed his support for a two-state solution as the preferred path forward in resolving the Israel-Gaza conflict.

Biden emphasized the need for a collective effort involving Israelis, Palestinians, regional partners and global leaders to work toward achieving peace. He stressed the shared goal of ensuring that both Israelis and Palestinians can coexist in safety, dignity and peace. The president also noted that returning to the previous status quo, as of Oct. 6, is not a viable option.

“That means ensuring Hamas can no longer terrorize Israel and use Palestinian civilians as human shields," Biden said.

When asked whether he had advised Israeli Prime Minister Benjamin Netanyahu against a ground invasion of Gaza, Biden responded that the decision ultimately rests with Israel. He said of securing the release of hostages from Gaza: “If we can get them out, we should get them out.”

Biden also warned Iran of a U.S. response if the country continues to act against U.S. troops, adding this has “nothing to do with Israel.”

In an address to the nation, Israeli Prime Minister Benjamin Netanyahu said Israel is in a battle for its existence. According to the Times of Israel, he stated that the primary objectives of the conflict are to eliminate Hamas by targeting its military and governance capabilities and to make every effort to secure the release of hostages.

Additionally, the PM said that Israel is getting ready for a ground operation, but did not disclose specific details regarding the timing and approach.

French President Emmanuel Macron has also weighed in on the situation, expressing concerns about a potential massive ground invasion of Gaza by Israel, calling it a “mistake,” as reported by Al Jazeera.

Al Jazeera Arabic correspondent Wael Dahdouh reported that his family in southern Gaza — having left their home in the north due to an Israeli evacuation order — was killed by Israeli strikes.

The Wall Street Journal reported that around 500 fighters from Hamas and Palestinian Islamic Jihad received specialized combat training in Iran under the guidance of the Islamic Revolutionary Guard Corps’ elite Quds Force in the weeks leading up to the Oct. 7 attacks.

Market Reactions

The equity selloff intensified during Biden’s speech, resulting in the SPDR S&P 500 ETF Trust SPY declining by 1.4% for the day, and the tech-heavy Invesco QQQ Trust QQQ experiencing a 2.4% drop.

In the bond market, there was significant pressure, with the yields on the 30-year Treasury surging by as much as 15 basis points to reach 5.09%. This caused the iShares 20+ Treasury Bond ETF TLT to fall by 2.5%.

On the commodities front, there was an upswing, with both gold and crude oil registering gains of 0.5% and 2%, respectively. Bitcoin BTC/USD also surged by 2.2%, reaching $34,680.

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President Joe Biden in the Oval Office earlier this month. White House photo by Adam Schultz.