BEIRUT, Lebanon (AP) _ After two days of tit-for-tat attacks that killed an Israeli soldier and two Lebanese civilians, Lebanese guerrillas and Israel both said Friday they would hold their fire.

The separate announcements came after Israeli warplanes left a deep crater in the highway from Beirut to the Syrian capital of Damascus on Friday and knocked out power stations in the Beirut suburb of Bsaleem and in the northern port city of Tripoli.

The latest round of retaliatory strikes _ the worst in nearly a a year _ began Thursday when two Lebanese women were killed in shelling by Israel's allied militia in southern Lebanon.

Hezbollah responded with its fierce rocket attack on Israel's northern border, killing a soldier and wounding 26 other people.

Fighting continued Friday, with Israel bombing major Lebanese cities and Shiite Muslim guerrillas sending more rockets into northern Israel. Israel briefly responded before deciding during a closed-door, high-level meeting not to retaliate because no one had been killed in the Friday morning rocket attack.

Secretary of State Madeleine Albright and U.N. Secretary-General Kofi Annan issued statements urging both sides to stop the fighting. The statements blamed neither side.

Israeli Prime Minister Ehud Barak warned that Syria would not be immune from attacks if the Lebanese guerrillas it backs continue to rocket Israeli towns after Israel withdraws its forces from Lebanon in July.

Syrian Foreign Minister Farouk al-Sharaa condemned the Israeli attacks in telephone conversations with Albright and Annan, Syria's official news agency SANA reported.

Despite the attacks Friday, Lebanese, raised on civil war and regular Israeli air raids, carried on nearly as usual.

``Power cuts? We are used to power cuts,'' said Hermineh Aslanian, a jewelry store owner in the capital's commercial Bourj Hammoud district.

``The Israeli strikes were harmful because they came on the eve of the summer season during which Lebanese expatriates and foreign tourists visit Lebanon and spend a lot of money,'' said Mustafa Asfahani, 40, who owns a Persian carpet shop in the shopping district of Hamra.

Lebanese have lived through a devastating 1975-90 civil war and Israeli raids in 1999 and 1996 that destroyed power stations. As a result, few homes or businesses lack their own source of electricity through private generators or neighborhood services.

``We weren't affected because things are available for us and we are used to it _ the power cuts,'' said Fadi Qadi, 29, who lives in a building that has its own generator.

The Damascus-Beirut highway was reopened to normal traffic after swift repairs late Friday. Children in Beirut went to school even as jets could be heard overhead. Traffic was stifling as usual and most businesses opened, although many reported fewer customers.

``People are afraid that the cycle of violence might continue,'' said Darwish Samouri, owner of a women's clothing shop.

George Mouawad, director general of the Electricity Company, said power would be rationed once again in Beirut and other areas because six new transformers at Bsaleem were destroyed. Mouawad said installations in Tripoli would take up to two years to fix.