In the latest violence, Israeli forces killed three Palestinians, including an Islamic Jihad militant in the occupied West Bank and a Jerusalem man who police said had stabbed an officer.

    Tuesday's ballot saw out the centrist incumbent, Yair Lapid, and his rare alliance of conservatives, liberals and Arab politicians which, over 18 months in power, had made diplomatic inroads with Turkey and Lebanon and kept the economy humming.

"The time has come to impose order here. The time has come for there to be a landlord," tweeted Itamar Ben-Gvir of the far-right Religious Zionism party, Likud's likely senior partner.

    He was responding to the stabbing reported by Jerusalem police. In the West Bank, troops killed an Islamic Jihad militant and a 45-year-old man in a separate incident, medics said. Queried on the latter death, the army said it opened fire when Palestinians attacked them with rocks and petrol bombs.

    A West Bank settler and former member of Kach, a Jewish militant group on Israeli and U.S. terrorist watchlists, Ben-Gvir wants to become police minister.

    Israeli media, citing political sources, said the new government may be clinched by mid-month. Previous coalitions in recent years have had narrower parliamentary majorities that made them vulnerable to no-confidence motions.

    With Netanyahu still not officially confirmed as prime minister, it was still unclear what position Ben-Gvir might hold in a future government. Since the election, both men have pledged to serve all citizens.

    But Ben-Gvir's ascendancy has stirred alarm among the 21% Arab minority and centre-left Jews - and especially among Palestinians whose U.S.-sponsored statehood talks with Israel broke down in 2014.

    While Washington has publicly reserved judgement pending the new Israeli coalition's formation, a State Department spokesman on Wednesday emphasised the countries' "shared values".

    "We hope that all Israeli government officials will continue to share the values of an open, democratic society, including tolerance and respect for all in civil society, particularly for minority groups," the spokesperson said.