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The company said sales in the Palestinian territories are "inconsistent" with its values. Israeli Prime Minister Naftali Bennett called the move "morally wrong" and vowed to fight it.
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The controversial law would prevent Palestinians in the occupied West Bank and Gaza from acquiring residency in Israel even after they marry Palestinians with Israeli citizenship.
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Israeli police and border officials said they arrested four suspects in the Sheikh Jarrah neighborhood, where settler groups are trying to evict several Palestinian families.
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Naftali Bennett is poised to end Benjamin Netanyahu's 12-year run as Israel's prime minister. The hardline conservative and former settler leader once vowed that Palestinians would never have a state.
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The recent violence that engulfed Gaza and Jerusalem began with an issue that's plagued the region for a century now: settlements.