Heavily armed Islamists attack in Cairo

RESIDENTS of Cairo's Manial neighbourhood are recovering from a bloody night of clashes with armed supporters of the Muslim Brotherhood who killed at least seven people and left dozens injured, they've told AFP.

The violence erupted when residents tried to stop hundreds of Islamists passing through Manial to reach protests being staged in the iconic Tahrir Square against toppled president Mohamed Morsi, who hails from the Muslim Brotherhood.

"The Brotherhood attacked the area with all kinds of weapons," said resident Mohammed Yehya, who lost three of his friends in the mayhem.

Inhabitants of the Nile island of Manial reported seeing dozens of bearded Islamists armed with machineguns, machetes and sticks on Friday night before the deadly clashes broke out.

Snipers were spotted on rooftops, and medics told AFP they treated some residents of the normally quiet middle-class neighbourhood for bullet wounds with a downward trajectory.

Buildings were pockmarked with bullet holes. Rocks carpeted the floor and charred tyres showed the ferocity of the violence.

The clashes in Manial and elsewhere came two days after the army toppled Morsi, underlining the determination of his Muslim Brotherhood to disrupt the military's plan for a political transition until new elections.

Residents say the attack began just minutes afer the Brotherhood's supreme guide, Mohammed Badie, gave a fiery speech to Morsi supporters camped out in Cairo's Nasr City, which was broadcast live on television.

"The attack came minutes after Badie's speech. They treated us like infidels. They were chanting 'Allahu akbar' (God is greatest) as they were shooting us," said Ahmed Fattouh.

On the door of one shop hung a sign announcing that the owner, 26-year-old Abdallah Sayyed Abdelazim, had been killed.

Parts of Manial were a ghost town on Saturday, with businesses shuttered and residents devastated by the night's violence.

"Their ammunition just didn't run out. They are trying to terrorise us and take over the country," said Khaled Tawfik.

Shopkeeper Mohammed Fekry, 29, who was wounded by birdshot said at least 10 people were killed and dozens injured.

"We have 10 people dead in this area, including six people who died with single bullets in the head. There were snipers on the roof of the Salaheddine mosque," Fekry said.

The overall toll for Friday's violence across Egypt was 30, but casualties are likely to rise.

Ihab al-Sayyed, a doctor at Qasr al-Aini hospital, told AFP that seven people he treated for injuries from the Manial clashes had died.

"I think the death toll will be much higher.

"The injuries were all from live bullets, most of them automatic weapons. Three of the dead and dozens of the injured were shot at from a height," the doctor said.

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WA offers Noongar people $1.3b title deal

THE West Australian government has made an historic $1.3 billion offer to settle the Noongar people's native title claim over Perth and the state's southwest.

Premier Colin Barnett proposes to settle the Noongar claim with the transfer of 320,000 hectares of crown land and a massive injection of government funding.

Central to the offer is a pledge to spend $50 million a year on a perpetual trust fund for social and economic development, as well as the establishment of six regional Noongar corporations.

In announcing the offer on Saturday, Mr Barnett said if the offer was accepted it would represent the most comprehensive native title agreement in Australian history.

He said a deal could cause seismic change for the Noongar people.

"Nothing happens overnight, but we expect this arrangement will help lift outcomes in Aboriginal health, education and employment over time," Mr Barnett said on Saturday.

"It should also help produce a new generation of Noongar leaders to drive further change within their community."

The state would continue to hold mineral rights over the transferred land under the proposed deal.

Mr Barnett said the Noongar people would have six months to consider the agreement, which the government hopes to start enacting within a year.

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Flag flap delays Spain's Pamplona bull run

A RED-AND-WHITE ocean of revellers erupted in cheers to launch Spain's annual San Fermin bull-running festival on Saturday but only after a 19-minute delay caused by a giant Basque flag that blocked the starting rocket.

The nine-day mix of alcohol-soaked partying and fleeing huge, sharp-horned fighting bulls is supposed to start at noon each year with a traditional shout of "Viva San Fermin!" and the launch of a firecracker known as the "chupinazo".

But just 10 minutes before the firework was to be set off from the city hall of the northern city of Pamplona, a massive Basque flag was hoisted in front of the building.

City officials struggled to remove the flag, strung up between buildings on either side of the Consistorial square, before the firecracker could be set off.

"I am not going to tolerate setting off the chupinazo with a flag that is not the flag of Pamplona," said the city's mayor, Enrique Maya.

"We have to do it the right way, and not with the indignity some want to impose on us," he told Spain's public television.

Pamplona lies in the Spanish Basque Country, where some favour creating an independent nation in northern Spain and southern France.

When the firework finally flew above the square, masses of people squeezed into the streets broke into cheers, danced and sprayed each other with sangria and cheap wine, turning white shirts pink.

"It's one of those big things you need to get done before you die," said Alison Windsor, a 27-year-old Australian who came just for the festival.

"I needed to come once in my life," she said.

"I am not sure I will run with the bulls."

The highlight of the festival is a bracing, daily test of courage against a pack of half-tonne fighting bulls.

Each day hundreds of people race with six huge bulls, charging along a winding course through the narrow streets to the city's bull ring, where the animals will be killed in a bullfight.

Fifteen people have been killed in the bull runs since records started in 1911.

The most recent death took place four years ago when a bull gored a 27-year-old Spaniard in the neck, heart and lungs.

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Pakistan train accident kills 14: official

AT least 14 people, including two children, were killed when a train collided with a packed motorcycle rickshaw in Pakistan's eastern Punjab province, officials say.

The passenger train travelling from the country's financial hub Karachi to Punjab capital Lahore on Saturday crushed the rickshaw on a road crossing which had no barrier.

"The accident occurred in Khanpur town of district Sheikhupura, around 40km northwest of Lahore," Salim Niazi, a local police official, told AFP.

Officials said at least two children were among the dead.

"Twelve people died on the spot. Four people with critical injuries were taken to hospital, of whom two expired," Muhammad Asim, a senior doctor at the local hospital, told AFP.

"Two of them were children under 12 years old," he said adding that many bodies were mutilated and unable to be identified.

Police said the rickshaw was over-capacity and drove onto the train track moments before the Lahore-bound train passed through, smashing into it.

"There was no gate at this crossing, (nor) a man to stop the traffic to clear a way for the train," said Niazi.

Pakistan has a poor railway system with a track dating back to British rule and old coaches. Many Pakistanis avoid travelling by train due to low safety standards and poor facilities.

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Iraq bombings kill five

A suicide attacker and a car bombing have killed at least 19 people in separate attacks in Iraq. Source: AAP

BOMBINGS north of Baghdad have killed five people, including a police officer, a day after attacks across the country left 23 dead.

A roadside bomb killed four people west of the northern city of Kirkuk, while another bomb in Tikrit, also north of the Iraqi capital, killed a police officer and wounded two others.

The attacks come a day after 23 people died in a string of attacks across the country, including the bombing of a Shi'ite religious hall.

Iraq is grappling with a protracted political standoff within its national unity government and months-long protests among its Sunni Arab minority.

Analysts and diplomats worry that the stand-off is unlikely to be resolved at least until general elections due next year.

With the latest violence, attacks have killed more than 160 people and wounded more than 400 in the first six days of July, according to AFP figures based on security and medical sources.

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Egypt military chiefs hold crisis talks

SENIOR military commanders are in emergency talks after Egypt's embattled President Mohamed Morsi rejected their ultimatum to resolve the current crisis, a source close to the military said.

The meeting comes ahead of a 1430 GMT (0030 AEST) deadline for the Islamist leader to "meet the demands of the people" - who took to the streets in their millions on Sunday demanding he go - or face army intervention.

"They are in talks to discuss the details of the roadmap" for the post-Morsi scenario, the source told AFP.

At the start of the meeting, the military chiefs swore to defend Egypt with their lives.

"We swear to God that we will sacrifice our blood for Egypt and its people against all terrorists, extremists and the ignorant," they declared in an oath led by army chief Abdel Fattah al-Sisi, the source said.

The army is expected to issue a statement after the expiry of its deadline, the source added.

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Portuguese govt totters, markets reel

PORTUGUESE Prime Minister Pedro Passos Coelho's government is close to collapse after two top ministers quit, pounding financial markets in Lisbon and across Europe.

Markets reacted severely after Foreign Minister Paulo Portas resigned Tuesday evening, a day after the shock departure of Finance Minister Vitor Gaspar.

EU officials told Portugal to take its responsibilities and clarify the situation "as soon as possible".

The crisis in recession-wracked Portugal spread fears in world markets of a new wave of instability from the bailed-out nation on the eurozone's debt-laden periphery.

The yield on benchmark 10-year Portuguese government bonds spiked above eight percent for the first time since November 2012, hitting 8.023 percent before easing a little. It closed the previous day at 6.720 percent.

The sharp rise in the bond yield is a warning that the government may have to pay exorbitant rates if it wants to sell newly issued bonds to the financial markets.

The Lisbon stock exchange's key PSI-20 index plunged 6.55 percent to 5,168.20 points in morning trade.

As concern spread, Madrid's IBEX 35 index slumped 3.15 percent to 7,638.2, London's FTSE 100 fell 1.64 percent to 6,200.66 points, Frankfurt's DAX 30 slid 1.93 percent to 7,757.78 points and in Paris the CAC 40 tumbled 1.70 percent to 3,679.03.

The euro fell to $1.2923 - hitting a low last recorded on May 29. That compared with $1.2978 late in New York on Tuesday.

Investors were unconvinced by the Portuguese premier's vow to stay on.

"Portugal, under severe economic pressure from a lack of growth, a bloated public sector and more than a decade on non-growth, most likely will see its government fall inside the next 48 hours, despite assurances from Prime Minister Pedro Passos Coelho that he will not resign," Saxo Bank chief economist Steen Jakobsen said.

"The coalition is falling, and falling soon," he said in a report.

Jakobsen said he expected a new election to be called with a huge drive against austerity measures.

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Rudd reckons Abbott lacks 'ticker'

PM Kevin Rudd (R) suspects Tony Abbott lacks the "ticker" to debate him on key policy areas. Source: AAP

PRIME Minister Kevin Rudd suspects Tony Abbott lacks the "ticker" to debate him on key policy areas.

Mr Abbott has been "lying" to the Australian people about the state of the economy, his ability to turn back asylum seeker boats and the impact of carbon pricing, Mr Rudd says in his first major television interview since retaking the leadership from Julia Gillard.

"So what I would say to Mr Abbott - you've been doing this for a long time, it's time we had a properly moderated debate ... on his chosen subjects," Mr Rudd said on the ABC's 730 program.

"Mr Abbott, I think it is time you demonstrated to the country you have a bit of ticker on this.

"He's the boxing blue. I'm the glasses-wearing kid in the library.

"Come on, let's have the Australian people form a view about whether his policies actually have substance, whether they actually work, or whether they are just slogans."

On his now-broken pledge never to return to the Labor leadership, Mr Rudd said Ms Gillard had vacated the spot and brought on the caucus ballot.

He said a second reason was the prospect of defeat at the 2013 election.

"The Australian Labor Party and the government was on track towards a catastrophic defeat and I wasn't about to stand idly by and see everything we worked for for the last five or six years go down the gurgler as Mr Abbott set about ripping it apart."

He said he was not motivated by revenge, but taking up the fight to Mr Abbott and coming up with a positive plan for the future.

Mr Rudd said he was working through policy changes but it would be an "orderly process".

He said he wanted to take the time to "think and take the best advice".

Asked whether Labor would be punished for its long leadership turmoil, Mr Rudd said he had faced four Liberal leaders over a period of four years after he took on the Labor leadership.

"In political parties these things happen from time to time," he said.

A spokesman for Mr Abbott told AAP the opposition leader would debate Mr Rudd once the prime minister "ends the uncertainty and names the election date".

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US home prices rise in May by most in 7yrs

US home prices jumped 12.2 per cent in May, suggesting the housing recovery is strengthening. Source: AAP

US home prices jumped 12.2 per cent in May from a year ago, the most in seven years. The increase suggests the housing recovery is strengthening.

Real estate data provider CoreLogic said on Tuesday that home prices rose from a year ago in 48 states. They fell only in Delaware and Alabama, while all but three of the 100 largest cities reported price gains.

Prices rose 26 per cent in Nevada to lead all states, followed by California (20.2 per cent), Arizona (16.9 per cent), Hawaii (16.1 per cent) and Oregon (15.5 per cent).

CoreLogic also said prices rose 2.6 per cent in May from April, the fifteenth straight month-over-month increase.

Steady hiring and low mortgage rates have encouraged more Americans to buy homes.

Greater demand, a limited number of homes for sale and fewer foreclosures have pushed prices higher, but prices are still 20 per cent below the peak reached in April 2006, it said.

Sales of previously occupied homes topped the five million mark in May for the first time in three and a half years. And the proportion of those sales that were "distressed" was at the lowest level in more than four years for the second straight month.

Distressed home sales include foreclosures and short sales - when a home sells for less than what is owed on the mortgage.

Home sales are expected to increase in the coming months. That's because the number of people who signed contracts to buy homes rose in June to the highest level since December 2006. There's generally a one- to two-month lag between a signed contract and a completed sale.

One worry is that higher mortgage rates could slow the housing recovery.

Still, rates remain low by historical standards and increases in rates could boost home sales because many Americans may act to lock in the lower rates before they rise further.

A survey by the University of Michigan released last week found more Americans believe it is a good time to buy a home because both rates and prices are just starting to rise.

Rates have been trending higher for two months.

The average rate on a 30-year fixed mortgage leapt to 4.46 per cent last week, according to mortgage buyer Freddie Mac., the highest in two years and a point more than a month ago.

Mortgage rates surged after Federal Reserve chairman Ben Bernanke said last month that the Fed could scale back its bond buying later this year and end it next year if the economy continued to strengthen. The bond purchases have kept long-term rates down.

Economists say higher mortgage rates are unlikely to stifle the housing recovery.

A more critical issue is whether potential buyers can get loans. There are signs that banks have become more willing to extend mortgages.

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S African court orders exhumation

Nelson Mandela's family are seeking to have grandson Mandla (pic) charged with grave tampering. Source: AAP

A SOUTH African court has ordered that the remains of three of Nelson Mandela's children be returned to his ancestral village, rejecting a bid by his oldest grandson to stop the exhumation following a bitter family feud.

A judge in the southern city of Mthatha upheld an earlier interim order for the grandson Mandla to transfer the remains to Qunu on Wednesday afternoon.

Mandela's grandson Mandla allegedly had the graves moved to Mvezo, about 30 kilometres away, in 2011 without the rest of the family's consent.

Mandela, who remains critically ill in what is now his fourth week in hospital, has expressed his wish to be buried in his childhood village of Qunu, and his daughters want to have the children's remains returned so they can be buried together.

A judge in the southern city of Mthatha upheld an earlier interim order for Mandla to return the remains to Qunu by Wednesday afternoon and instructed him to pay all legal costs.

The order was issued in response to a request by more than a dozen relatives of the revered leader, who led the struggle against white-minority rule in South Africa and won election as the country's first black president in 1994 after spending 27 years in apartheid prisons.

The relatives who brought the case included two of Mandela's daughters and several grandchildren.

After the decision, family members stood up and hugged each other.

Mandela's eldest daughter Makaziwe refused to comment on the ruling, saying "a private matter will remain private".

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Facebook cuts ads from controversial pages

Facebook is pulling ads from pages that contain violence or sexual content. Source: AAP

FACEBOOK is pulling ads from pages that contain violence or sexual content.

The social network says that on Monday it will expand its definition of pages and groups that are too controversial to carry advertisements.

Facebook has sought to strike a balance between giving its 1.1 billion monthly users the freedom to post what they want and providing advertisers with space to sell their products.

In May, Facebook Inc lost more than a dozen advertisers, at least temporarily, after the activist group Women, Action and the Media urged an advertising boycott to protest hate speech on the Facebook site.

The controversial content included grisly photos and mottos that encouraged rape, abuse and other violence against women.

The company said then that it would review its guidelines.

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No breakthrough for Kerry in Mideast talks

US-LED efforts to broker a resumption of peace talks have ended without a breakthrough, a top Palestinian official says, although Washington's top diplomat hailed "real progress".

US Secretary of State John Kerry has spent the past four days locked in intensive shuttle diplomacy between the Israeli and Palestinian leadership in a high-profile bid to draw the two sides back into direct negotiations after a gap of nearly three years.

But after 13 hours of talks with Israeli Prime Minister Benjamin Netanyahu, and around six hours with Palestinian president Mahmud Abbas, Kerry's marathon efforts ended on Sunday with little sign of progress.

Speaking in Ramallah after Kerry held his third and final meeting with Abbas, chief negotiator Saeb Erakat said there had been "no breakthrough."

"It was a positive and profound meeting with president Abbas but there has been no breakthrough so far and there is still a gap between the Palestinian and Israeli positions," he told a news conference.

But Kerry himself insisted he had had "very positive" discussions with both sides since beginning his shuttle diplomacy in Jerusalem on Thursday night.

"We agreed we have made real progress but we have a few things we need to work on," he said after a final meeting with Abbas before heading off to Asia.

"We both feel good about the direction," he said.

Netanyahu insisted that Israel was not blocking a return to negotiations.

"We are not putting up any impediments on the resumption of the permanent talks for a peace agreement between us and the Palestinians," he said.

"There are things that we will strongly insist on in the talks themselves, especially security ... there will be no agreement that will endanger Israelis' security."

Abbas is pushing Israel to free the longest-serving Palestinian prisoners, to remove roadblocks in the West Bank and to publicly agree to make the lines that existed before the 1967 Middle East war the baseline for negotiations.

Netanyahu is reportedly willing to consider just the first two conditions - but only after talks are under way - and has flatly refused to countenance any return to the 1967 lines.

Palestinian officials appeared pessimistic about Kerry's chances of achieving a breakthrough.

"Netanyahu and his government are not serious about establishing a Palestinian state in the 1967 borders, they speak of a state without clear borders, and we need clarity according to international resolutions," said Azzam al-Ahmed, a senior official of Abbas's ruling Fatah party.

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Obama to host summit of African leaders

Barack Obama will host a landmark summit of leaders from across sub-Saharan Africa next year. Source: AAP

US President Barack Obama will host a landmark summit of leaders from across sub-Saharan Africa next year, the White House says.

The plan has strong echoes of high-profile China-Africa summits, which over the last decade have cemented Beijing's clout on the continent.

Obama will announce on Sunday that "he plans to host the first of its kind, a summit of leaders from across sub-Saharan Africa in the United States," said senior White House advisor Ben Rhodes.

"This is something that we've never done before. It's something that other nations have done," said Rhodes.

Obama is currently on the first major visit to the continent where his father was born since his election almost five years ago.

He made a brief visit to Ghana in 2009. Critics say a more substantial trip had been long overdue and have accused Obama of allowing China to steal ground from the United States in business and diplomacy.

"What we want to do is to continue the type of high-level engagement that we've had in this trip, we want to have that marker laid down so that next year the President is bringing together heads of state from across sub-Saharan Africa in Washington," said Rhodes.

Speaking in the iconic township of Soweto on Saturday, Obama dismissed talk of a Chinese and US scramble for influence on the continent, but urged Africans to watch out for lop-sided deals with foreign investors.

"I actually welcome the attention that Africa is receiving from countries like China and Brazil and India and Turkey."

But he urged African nations to make sure trade was not a one-way street.

"When we look at what other countries are doing in Africa, I think our only advice is make sure it's a good deal for Africa.

"Somebody says they want to come build something here: Are they hiring African workers? Somebody says that we want to help you develop your natural resources: How much of the money is staying in Africa?"

Obama, in South Africa on the second-leg of a three-nation Africa tour, said that too often foreign investment did not benefit locals and actually encouraged the type of corruption and resource-stripping that guts economies.

He offered up the United States as a more equitable partner which wanted African economies to grow into consumer powerhouses.

Amid a raft of Chinese investment, which topped $200 billion last year, US businesses have expressed concern that Africa is a diplomatic blind spot for their government.

In March, China's new President Xi Jinping visited Africa, as well as Russia, on his first foreign trip, signing a raft of business and energy deals signalling Beijing's intent to deepen ties further.

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EU wants answers over alleged US bugging

A top EU official says ties with the US could suffer over a report that America bugged EU offices. Source: AAP

THE European Union is angrily demanding answers from the United States over allegations Washington had bugged its offices, the latest spying claim attributed to fugitive leaker Edward Snowden.

The report in German weekly Der Spiegel is likely to further strain relations between the United States and Europe, shortly after they launched formal negotiations to create what would be the world's biggest free trade area.

Der Spiegel said its report, which detailed covert surveillance by the US National Security Agency (NSA) on EU diplomatic missions, was based on confidential documents, some of which it had been able to consult via Snowden.

"We have immediately been in contact with the US authorities in Washington DC and in Brussels and have confronted them with the press reports," the European Commission said in a statement.

"They have told us they are checking on the accuracy of the information released yesterday and will come back to us."

One document, dated September 2010 and classed as "strictly confidential", describes how the NSA kept tabs on the European Union's mission in Washington, Der Spiegel said.

Microphones were installed in the building and the computer network infiltrated, giving the agency access to emails and internal documents.

The EU delegation at the United Nations was subject to similar surveillance, Der Spiegel said.

US Deputy National Security Advisor Ben Rhodes refused to be drawn into commenting directly on the allegations in a briefing in Johannesburg on Saturday, but said it was "worth noting" the US was "very close" to EU security services.

The Spiegel report is the latest in a series of allegations about US spying activity revealed by Snowden, a former NSA contractor who is holed up in a Moscow airport transit zone after the United States issued a warrant for his arrest and revoked his passport.

EU powerhouse Germany said the United States must quickly say whether the reports were true or not.

"It's beyond our imagination that our friends in the US consider the Europeans as enemies," Justice Minister Sabine Leutheusser-Schnarrenberger said in a statement.

The US authorities issued an arrest warrant this month for Snowden after he revealed details of NSA's so-called PRISM program which collects and analyses information from internet and phone users around the world.

Snowden himself remains in political limbo at Moscow's Sheremetyevo airport after flying in from Hong Kong last week, unable to fly on without legal travel documents or exit the airport without a Russian visa.

Ecuador's President Rafael Correa said that US Vice President Joe Biden had asked Quito to reject any asylum request from the 30-year-old who is wanted by the United States on charges including espionage.

But he said Snowden's fate was in Russia's hands as Quito could not process his asylum request until he was on Ecuadoran soil.

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Snowden handover impermissible: Russian MP

A TOP Russian politician has declared it was "morally impermissible" to hand over to the United States fugitive intelligence leaker Edward Snowdon, who remains in a political limbo at a Moscow airport.

Snowden, the 30-year-old former contractor for the National Security Agency (NSA), has been living in the transit zone of Sheremetyevo airport for over a week, unable to fly on with a revoked US passport or exit the airport without a Russian visa.

Snowden has requested asylum in Ecuador but is unable to get to its embassy in central Moscow.

Alexei Pushkov, who heads the international affairs committee at the Duma lower house of parliament, said it would be wrong to give Snowden over to the United States where he is wanted for leaking classified information about covert US surveillance programs.

"It's not a matter of (Snowden's) usefulness (to Russia) - it's a matter of principle," he wrote on Twitter Sunday. "Handing over a political refugee is morally impermissible."

The Kremlin on Sunday played down the fact that Snowden is still living at the airport, with President Vladimir Putin's spokesman telling the Echo of Moscow radio station that "this issue is not on the Kremlin's agenda."

"Since it's not our issue, I don't know what options there are for the situation's development, nor what the legal or other aspects are in this," said spokesman Dmitry Peskov.

Putin shockingly admitted on Tuesday that Snowden is staying in the transit zone of Sheremetyevo airport, and cannot be extradited to the US due to the lack of a bilateral extradition agreement. The Russian leader also advised Snowden to pick his destination soon.

The situation seems to be near a dead end as Ecuador has declared that it's up to Moscow to resolve the dilemma over Snowden.

"To process the asylum application, (Snowden) must be in Ecuadorian territory," President Rafael Correa said on Saturday. However, Snowden would need a visa from Russian authorities to get to Ecuador's embassy in central Moscow.

"We cannot be on the sidelines, we should participate in his fate," said another lawmaker Sunday, senator Valery Shnyakin, who is the deputy chairman of the international affairs committee in the Federation Council upper house of parliament.

"We should calculate the negative repercussions on our relations with the Americans," he added in remarks posted on the ruling United Russia party website. "For that, we need some kind of negotiations and meetings."

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