What is the appropriate response to students who peek at the exam questions before the exam starts?

I don't know what an "invigilator" is exactly, but I presume that you merely watch the students to make sure they don't cheat, distribute exams and paper, and take the filled exams at the end, more or less.

As such it isn't your role to decide on any kind of punishment for cheating. There are probably procedures in place to report cheating. Do it. What happens next isn't up to you. If there are no formal procedures, take the name of the student and inform whoever is in charge (the professor in charge of the course for example).

Unless you have explicitly been told that it is okay, I would recommend being extra careful about expelling students. Students are afforded due process. If it is ever found out that peeking at the exam isn't something worth getting a zero on the exam or if the student is not found guilty, then having expelled them is something that will be terribly hard to correct. In my university the rule is to expel students only if their behavior causes trouble for the other students or in cases of person substitution (someone is taking the exam in the student's place). And even then, it's not the role of the proctor to decide this -- you have to get approval from the university president's office.

If it really makes a difference, you could put each exam in a sealed manila envelope. When you announce that the students can begin, then they can tear open the envelope and remove the exam.

Lots of standardized tests use this approach.

Penalize those that do it with the consequences for cheating - once you actually DO something then the rest will tend to stop...

At the moment while you let it go or "condone it" through your inaction then they will continue...

Expulsion is not the only punishment, a later exam with a “replacement fee” or an exam in the following semester are all valid sanctions used in different institutions.