cnxps.cmd.push(function () { cnxps({ playerId: '36af7c51-0caf-4741-9824-2c941fc6c17b' }).render('4c4d856e0e6f4e3d808bbc1715e132f6'); });

Yaakov Lappin and Reuters contributed to this report.

Prime Minister Binyamin Netanyahu Thursday vowed to strike at those who attack Israel and said the Jewish state can never stop fighting terrorism, speaking hours after a Grad rocket fired from the Sinai Peninsula exploded in Eilat Speaking at a ceremony marking 40 years since the operation to free hostages on hijacked Sabena Flight 571 , during which as a young commando he was shot and wounded, Netanyahu said Israel must constantly fight against those who perpetrate and plan terrorism." Israel must always fight terrorism, he continued, "It will not stop if we do not fight it."Sinai, he continued, has become a terrorism zone, something he said Israel is "dealing with." The security fence being built along the southern border will not stop missiles, but a solution for that too will be found, he said.A Grad-type rocket fired from Sinai exploded in a residential neighborhood of Israel's southernmost city early Thursday morning. Residents reported hearing three explosions, but police sappers only located the remnants of one Grad rocket.Police were continuing to search for other rockets and holding security assessments in Eilat late Thursday morning, police spokesman Micky Rosenfeld said.Defense Minister Ehud Barak held a situational briefing in Tel Aviv Thursday with IDF Chief of General Staff Lt.-Gen. Benny Gantz in light of the rocket attack, which he called "a grave incident.""We are studying the incident and will strike the people who fired on Eilat and attempted to harm Israeli citizens," Barak said, adding, "There will be no compromises."Earlier Thursday, Barak said that "the challenge of terrorism is not over and will accompany today's soldiers until their hair recedes and turns grey."Eilat police chief Asst.-Cmdr. Ron Gertner said the southern city has been on high alert due to the upcoming Passover holiday.Asked if the rocket was fired from Sinai, Gertner said: "Based on our working assumptions and the (rocket) range, yes."However, an Egyptian security source told Reuters in Cairo that Egyptian forces were searching the area along the border but had not found any evidence indicating any rockets had been fired from the Sinai.