Israel strikes Beirut's suburbs to target what it says is Hezbollah drone production

BEIRUT (AP) — The Israeli military struck several sites in Beirut’s southern suburbs that it said held underground facilities used by Hezbollah for drone production Thursday, on the eve of the Eid al-Adha holiday.

The strikes marked the first time in more than a month that Israel had struck on the outskirts of the capital and the fourth time since a US-brokered ceasefire agreement ended the latest war between Israel and the Lebanese militant group Hezbollah in November.

Israel posted a warning ahead of the strikes on X, formerly known as Twitter, announcing that it would hit eight buildings at four locations.

Israel has continued to carry out near-daily strikes in southern and eastern Lebanon since the ceasefire, which Lebanon has said are in violation of the agreement. Israeli officials say the strikes are intended to prevent Hezbollah from regrouping after a war that took out much of its senior leadership and arsenal.

The Israeli army said in a statement that Hezbollah was “working to produce thousands of drones under the guidance and financing of Iranian terrorist groups.”

Hezbollah “used drones extensively in its attacks against the State of Israel and is working to expand its drone industry and production in preparation for the next war,” the army statement said.

There was no immediate statement from Hezbollah.

A Hezbollah official denied that there were drone production facilities at the targeted locations.

“In the (ceasefire) agreement, there is a mechanism for investigating if there is a complaint,” the official said. “Israel in general, and Netanyahu in particular, wants to continue the war in the region.”

A Lebanese army official said the army had attempted to convince Israel not to carry out the strikes and to instead let Lebanese officials go in to search the area under the mechanism laid out in the ceasefire agreement, but that the Israeli army refused, so Lebanese soldiers moved away from the locations. Israeli army officials could not immediately be reached for comment.

Both Lebanese officials spoke on condition of anonymity because they were not authorized to speak publicly.

Lebanese President Joseph Aoun and Prime Minister Nawaf Salam condemned the strikes.

Aoun in a statement called them a “blatant violation of an international agreement, as well as the basic principles of international and humanitarian laws and resolutions, on the eve of a sacred religious occasion” and said it demonstrates Israel's “rejection of the requirements of stability, settlement and just peace in our region.”

He accused Israel of using Lebanon as a “mailbox” to send a message to the United States. He did not elaborate. Washington has been negotiating with Iran - Hezbollah's longtime backer - for a deal over Tehran's nuclear program and has warned Israel not to strike Iran in the meantime.

Israeli Defense Minister Israel Katz in a statement praised the Israeli air force for “perfect execution” of the strikes and said Israel will “continue to enforce the ceasefire rules without any compromise.” He said Israel holds the “Lebanese government directly responsible for preventing violations of the ceasefire and all terrorist activity against the state of Israel.”

The conflict between Hezbollah and Israel began on Oct. 8, 2023 when the Lebanese militant group began launching rockets across the border in support of its ally, Hamas, in Gaza. Israel responded with airstrikes and shelling and the two were quickly locked in a low-level conflict that continued for nearly a year before escalating into full-scale war in September 2024.

It killed more than 4,000 people in Lebanon, including hundreds of civilians, while the Lebanese government said in April that Israeli strikes had killed another 190 people and wounded 485 wounded since the ceasefire.

There has been increasing pressure on Hezbollah - both domestic and international - to give up its remaining arsenal, but officials with the group have said they will not do so until Israel stops its airstrikes and withdraws from five points it is still occupying along the border in southern Lebanon.

Flames rise following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

Flames and smoke rise following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

Flames and smoke rise following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

Smoke rises following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

Smoke rises following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

Smoke rises following an Israeli airstrike on Dahiyeh in the southern suburb of Beirut, Lebanon, Thursday, June 5, 2025. (AP Photo/Hassan Ammar)

NEW YORK (AP) — Up until this week, Wall Street has generally benefited from the Trump administration’s policies and has been supportive of the president. That relationship has suddenly soured.

When President Donald Trump signed the One Big Beautiful Bill into law in July, it pushed another significant round of tax cuts and also cut the budget of the Consumer Financial Protection Bureau, at times the banking industry's nemesis, by nearly half. Trump’s bank regulators have also been pushing a deregulatory agenda that both banks and large corporations have embraced.

But now the president has proposed a one-year, 10% cap on the interest rate on credit cards, a lucrative business for many financial institutions, and his Department of Justice has launched an investigation into Federal Reserve Chair Jerome Powell that many say threatens the institution that is supposed to set interest rates free of political interference.

Bank CEOs warned the White House on Tuesday that Trump’s actions will do more harm than good to the American economy. But in response, Trump did not back down on his proposals or attacks on the Fed.

BNY Chief Executive Officer Robin Vince told reporters that going after the Fed’s independence “doesn’t seem, to us, to be accomplishing the administration’s primary objectives for things like affordability, reducing the cost of borrowing, reducing the cost of mortgages, reducing the cost of everyday living for Americans.”

“Let’s not shake the foundation of the bond market and potentially do something that could cause interest rates to actually get pushed up, because somehow there’s lack of confidence in the Fed’s independence,” Vince added.

The Federal Reserve’s independence is sacrosanct among the big banks. While banks may have wanted Powell and other Fed policymakers to move interest rates one way or another more quickly, they have generally understood why Powell has done what he's done.

“I don’t agree with everything the Fed has done. I do have enormous respect for Jay Powell, the man,” JPMorgan Chase CEO Jamie Dimon told reporters Tuesday.

Dimon's message did not seem to resonate with President Trump, who told journalists that Dimon is wrong in saying it’s not a great idea to chip away at the Federal Reserve’s independence by going after Chair Jerome Powell.

“Yeah, I think it’s fine what I’m doing,” Trump said Tuesday in response to a reporter’s question at Joint Base Andrews after returning from a day trip to Michigan. He called Powell “a bad Fed person” who has “done a bad job.”

Along with the attacks on the Fed, President Trump is going after the credit card industry. With “affordability” likely to be a key issue in this year’s midterm elections, Trump wants to lower costs for consumers and says he wants a 10% cap on credit card interest rates in place by Jan. 20. Whether he hopes to accomplish this by bullying the credit card industry into just capping interest rates voluntarily, or through some sort of executive action, is unclear.

The average interest rate on credit cards is between 19.65% and 21.5%, according to the Federal Reserve and other industry tracking sources. A cap of 10% would likely cost banks roughly $100 billion in lost revenue per year, researchers at Vanderbilt University found. Shares of credit card companies like American Express, JPMorgan, Citigroup, Capital One and others fell sharply Monday as investors worried about the potential hit to profits these banks may face if an interest rate cap were implemented.

In a call with reporters, JPMorgan’s Chief Financial Officer Jeffrey Barnum indicated the industry was willing to fight with all resources at its disposal to stop the Trump administration from capping those rates. JPMorgan is one of the nation's biggest credit card companies, with its customers collectively holding $239.4 billion in balances with the bank, and having major co-brand partnerships with companies such as United Airlines and Amazon. JPMorgan also recently acquired the Apple Card credit card portfolio from Goldman Sachs.

“Our belief is that actions like this will have the exact opposite consequence to what the administration wants in terms of helping consumers,” Barnum said. “Instead of lowering the price of credit, it will simply reduce the supply of credit, and that will be bad for everyone: consumers, the broader economy, and yes, for us, also.”

Even the major airline and hotel partners who partner with banks to issue their cards were also not pleased with the White House's push to cap interest rates.

“I think one of the big issues and challenges with (a potential cap) is the fact that it would actually restrict the lower end consumer from having access to any credit, not just what the interest rate they’re paying, which would upend the whole credit card industry,” said Ed Bastion, CEO of Delta Air Lines, to analysts on Tuesday. Delta has a major partnership with American Express, and its co-brand credit card brings in billions of dollars in revenue for Delta.

Trump seemed to double down on his attacks on the credit card industry overnight. In a post on his social media platform Truth Social, he said he endorsed a bill introduced by Sen. Roger Marshall, R-Kansas, that would likely cut into the revenue banks earn from merchants whenever they accept a credit card at point-of-sale.

“Everyone should support great Republican Senator Roger Marshall’s Credit Card Competition Act, in order to stop the out of control Swipe Fee ripoff,” Trump wrote.

Trump told reporters Tuesday that he was not going to back down the credit card interest rate issue.

“We should have lower rates. Jamie Dimon probably wants higher rates. Maybe he makes more money that way,” Trump said.

The comments from Wall Street are coming as the major banks report their quarterly results. JPMorgan, the nation’s largest consumer and investment bank, and The Bank of New York Mellon Corp., one of the world’s largest custodial banks, both reported their results Tuesday with Citigroup, Bank of America, Wells Fargo and others to report later this week.

President Donald Trump arrives at Joint Base Andrews, Tuesday, Jan. 13, 2026, in Joint Base Andrews, Md. (AP Photo/Evan Vucci)

FILE - Jamie Dimon, CEO of JPMorgan Chase, speaks at the America Business Forum, Thursday, Nov. 6, 2025, in Miami. (AP Photo/Rebecca Blackwell, file)