The potential for this operation by the IDF to lose containment and involve the Egyptians and their Islamist government in hostilities cannot be ruled out. But so far, President Morsi is restricting his response to angry denunciations and calls for an emergency meeting of the Security Council.

Washington Post:

Israeli jets and drones hit dozens of targets overnight in an intense air campaign against militant targets in the Gaza Strip the day after a missile strike killed the Hamas military chief in an operation that raised the specter of an all-out conflict.

Israeli officials said Wednesday's attacks were aimed at crippling the military capabilities of Gaza-based militants who fire rockets into southern Israel and warned that it could evolve into a ground operation.

ut the barrage of rockets fired from Gaza continued unabated. Three Israelis were killed early Thursday when a rocket struck an apartment building in Kiryat Malakhi in southern Israel, Israeli police said.

A spokesman for the Hamas-run Health Ministry in Gaza, Ashraf al-Qedra, said eight Palestinians had been killed, including two children and four other civilians.

Residents in Gaza said militants have begun firing rockets at Israeli targets from inside teeming Gaza city, making direct Israeli strikes on the populous city likely.

"We are at the start of the event and not at its end," said Defense Minister Ehud Barak, pledging to do "whatever is necessary to restore quiet to the south."

Representatives of Hamas, which Israel and the United States consider a terrorist organization, said they also have no intention of backing down. The assassination of Ahmed al-Jabari, the Hamas military commander, "is a serious crime, and they crossed the red line," said Fawzi Barhoum, a Hamas spokesman. "It's time to declare war."

Egypt's Islamist-led government also condemned Jabari's assassination, and announced the withdrawal of its ambassador to Israel.

[...]

Israeli jets and drones hit dozens of targets throughout the Mediterranean enclave early Thursday, including munitions warehouses and residential buildings that the military said operated as warehouses. The military said it targeted more than 100 long- and medium- range rocket launching sites and several launch squads overnight, doing "significant" damage to stockpiles that include Iran-supplied Fajr-5 missiles.

If drawn out, the Israeli campaign could paralyze the crowded Hamas-ruled Gaza Strip, trigger barrages of retaliatory attacks from the organization and its regional allies, and upend already cool relations between Israel and Egypt.

Tensions are already high between Israel and Iran, and it wouldn't be outside the realm of the possible for Tehran's proxy terrorist group Hezb'allah to launch some rockets of their own. But both Iran and Egypt have massive problems of their own to deal with and a war with Israel would only exacerbate their economic weakness.

An IDF spokesman has indicated that this is only the beginning of the operation. A ground assault into Gaza is possible, but apparently not imminent. We shall see what the next 48 hours brings.