JERUSALEM—Two Palestinians stabbed and wounded an Israeli civilian in a central Israeli town on Thursday, as U.S. Secretary of State John Kerry urged Israeli Prime Minister Benjamin Netanyahu to take steps to end the latest wave of Palestinian-Israeli violence and return to the peace process.

Police in Beit Shemesh shot both of the Palestinian attackers, one of whom later died in the hospital of his wounds. Both men wore shirts bearing the emblem of the military wing of the Palestinian Islamist movement Hamas, which rules...