Israel and Hamas moved ahead on a key first step of the tenuous Gaza ceasefire agreement by freeing hostages and prisoners, raising hopes that the U.S.-brokered deal might lead to a permanent end to the two-year war that ravaged the Palestinian territory.

It is unclear if disagreement over the list of Palestinian prisoners will affect the release of hostages within the agreed 72 hours.

Israel’s military says it has completed first phase of withdrawal, ahead of Monday peace summit in Egypt