Weather goes from bad to worse in Qld

EX-CYCLONE Oswald refused to budge from central Queensland and whipped up three mini-tornadoes that injured at least 17 people, damaged scores of homes and forced the evacuation of towns around Bundaberg on Australia Day.

To the north, floods in Gladstone led to the city being declared a disaster zone and was the biggest concern for authorities on Saturday evening.

Torrential rain topped a metre in 48 hours and has swollen the Boyne River to two metres higher than the previous record.

About five metres of water is pouring over the spillway of the Awoonga Dam into the Boyne, just south of Gladstone.

Tannum Sands and Boyne Island, at the mouth of the Boyne River, narrowly escaped inundation on Saturday.

But they may not be so lucky when an extraordinarily high tide hits on Sunday morning.

"We're now getting ready for the next time when we think we'll have the biggest problem and that's at the high tide on Sunday morning," Gladstone Mayor Gail Sellers told AAP.

About 2000 people have been asked to evacuate.

Queensland Premier Campbell Newman said a saddle dam off the Awoonga Dam is close to overflowing, which would put 500 homes in peril.

He said the government is considering mandatory evacuations.

"That's my main concern," he said.

Mini-tornadoes that tore through the costal townships of Bargara and Burnett Heads struck after 1pm AEST, damaging homes, shops, a bowling club and government buildings.

Both townships were declared disaster areas.

A man and woman in a parked car on the Esplanade at Bargara were critically injured when a huge pine tree toppled onto the car's roof.

At least 15 other people were treated for minor injuries after being hit by flying glass and other debris.

Queensland emergency services minister Jack Dempsey, who lives in Bundaberg, said 150 homes were damaged at Burnett Heads - and two completely destroyed - by one of three tornadoes to strike the Bundaberg district.

"There are a number of small towns and suburbs that were hit by the mini-tornadoes," Mr Dempsey said.

"We are still trying to assess the extent of the damage."

The third and final mini-tornado badly damaged a home when it hit the coastal town of Coonarr, about 20km south of Bundaberg, at about 4.30pm (AEST).

Mr Newman, who addressed a press conference shortly after the first of the mini-cyclones had struck Bargara, said the Callide and Kroombit Dams, west of Gladstone, were experiencing unprecedented outflows.

Residents at Jambin and Goovigen have been ordered to take refuge on higher ground.

Flood warnings have been issued for the Calliope, Boyne, Baffle and Kolan Rivers.

In Rockhampton, floodwaters have inundated barbecues and car parks along the Fitzroy River.

The river continues to rise as it absorbs about half a metre of rain dumped on the city this week.

Mr Dempsey said the SES has received more than 650 requests for assistance since Friday morning, including more than 130 for Rockhampton, and more than 35 jobs each for Gladstone and Yeppoon.

There were also six swift-water rescues.

"Thankfully they were all very successful outcomes," he told ABC Radio.

A 60-year-old fisherman was found on Balaclava Island on Saturday afternoon, surviving more than 40 hours lost at sea.

His 38-foot fishing vessel began taking on water off Port Alma on Thursday.

Authorities are still searching for the second fisherman on board.

The rain depression is expected to finally mobilise southward overnight to begin tormenting the southeast.

In the next few days about 300mm of rain is expected in Wivenhoe Dam catchment, upstream of Brisbane, and coastal areas could get as much as 500mm.

Mr Newman said controlled releases from the dam are continuing and there is no doubt it will be able to cope with the influx of rainwater in the coming days.

"We can absorb that flood," he said.

The biggest risk will come from suburban creeks in the Gold and Sunshine Coast and greater Brisbane area.

"With all that heavy rain, flash flooding is definitely expected," Ken Kato from the Bureau of Meteorology told AAP.

The Moreton Bay Regional council is warning residents to prepare for tidal surges expected to cause flooding in low lying areas on Saturday and Sunday.

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Death sentences for Egypt soccer violence

AN Egyptian court has handed down death sentences for 21 people accused of taking part in soccer violence in 2012 that killed 74.

In the courtroom, families of the deceased wailed and raised their hands in the air shouting "Allahu Akbar", Arabic for "God is great".

The judge said in his statement read live on state TV that he would announce the verdict for the remaining 52 defendants on March 9.

Among those on trial are nine security officials.

The soccer melee on February 1, 2012 between Port Said's Al-Masry fans and Cairo's Al-Ahly fans was the world's deadliest soccer violence in 15 years.

As is customary in Egypt, the death sentences will be sent to a top religious authority, the Grand Mufti, for approval.

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Crowds surge to Swan River for fireworks

ABOUT 300,000 people are expected to attend Perth's Skyworks display on the Swan River to celebrate Australia Day, up 50,000 from last year thanks to milder weather.

The city has enjoyed a 36C degree maximum, compared to 2012's sweltering 41C.

So far, the gathering throng has largely abided alcohol restrictions aimed at curbing antisocial behaviour, but police expect to impose some $200 fines before the event draws to a close.

At another popular destination, the port city of Fremantle, some 500 people have gathered for one of Western Australia's biggest citizenship ceremonies.

They were among the state's more than 2500 new citizens, hailing from 92 countries, to take the pledge on Saturday.

More than 80 citizenship ceremonies were held around the state, ranging from single-person ceremonies in country towns like Ravensthorpe, to the welcoming of 700 new citizens at Wanneroo - the second largest such event in the country.

One of the new Australians, Italy-born mother-of-one Cecilia Crespi, said she liked Australia's strong community feeling, egalitarian ideals and life-improving opportunities.

Briton Cathy Clayton, who moved to Perth with her policeman husband and teenage daughter, said she loved living in a house with a swimming pool that was close to the beach.

"My heart is truly embedded in the Australian way of life," she said.

Deputy leader of the opposition, Julie Bishop, told a citizenship ceremony in Perth's western suburbs that Australians were fortunate to live in an exciting and dynamic place.

"We enjoy a level of freedom based on our values and our beliefs that others around the world can only dream about," Ms Bishop said.

"We have a modern, dynamic economy that allows us the opportunity to have a standard of living that is amongst the highest in the world."

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Five tornadoes leave trail of destruction

TOWNS around the southeast Queensland city of Bundaberg could spend up to two days without power after five tornadoes wreaked havoc in the area on Australia Day.

Burnett Heads and nearby Bargara were declared disaster areas after twisters ripped through the coastal townships from 1pm AEST on Saturday, injuring a total of 17 people and damaging more than 150 homes.

Two people were critically injured when a giant pine tree fell on their parked car on the Esplanade at Bargara, while two homes were completely destroyed in the mini-cyclone that struck Burnett Heads.

Authorities said Burnett Heads was again struck by the latest in the series of twisters, which hit the area at 6pm AEST and 6.30pm.

Two people were believed to have been injured in the second onslaught, with powerlines down and at least one roof torn from a home.

And the Bureau of Meteorology says the worst may be yet to come.

It has forecast the "strong possibility" of further tornado activity around Burnett Heads, Wide Bay and at Maryborough, south of Bundaberg.

Queensland Premier Campbell Newman said powerlines were down in Burnett Heads and several buildings had lost their roofs.

Emergency services said the Bargara and Burnett Heads twisters had cut a "swathe of damage".

Power companies said it could take up to two days to restore electricity to the towns that were hit.

Bargara resident Judith McNamara, who witnessed the tornado through her kitchen window, said it left a car in her yard with a tree through it.

"All of a sudden ... I looked up and a tree went flying through the air ... and the car went up," she told ABC radio.

At least 15 other people were treated for minor injuries after being hit by flying glass and other debris in violent storm gusts.

A triage centre was set up outside a church at Bargara to treat the injured, while an evacuation centre was opened at Bundaberg, about 15km away.

Queensland Emergency Services Minister Jack Dempsey, who lives in Bundaberg, said a number of small towns and suburbs in the district had been hit by the mini-tornadoes.

"We are still trying to assess the extent of the damage," he said.

The third twister badly damaged a home when it hit the coastal town of Coonarr, about 20km south of Bundaberg, around 4.30pm (AEST).

As of 7.30pm AEST, residents in Bundaberg were being warned by Queensland police to stay indoors and shelter well clear of windows, doors and skylights as fierce storms continued to rage outside.

Meanwhile, residents in the small community of Winfield, north of Bundaberg, were issued an emergency notice and told to head to higher ground, with flooding imminent.

The State Emergency Service was warning that nearby Baffle Creek was expected to rise above record levels set in 1971.

Bundaberg district disaster co-ordinator superintendent Rowan Bond said the rain at Winfield was "unprecedented".

"Baffle Creek is higher than virtually anyone can remember," he told ABC TV.

Ergon Energy has warned Bundaberg, Bargara and Burnett Heads could be without power for up to 48 hours.

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India wheels out new long-range missile

INDIA has wheeled out a new long-range nuclear missile that can hit anywhere in China and warned rival Pakistan not to take its friendship "for granted" as it celebrated its Republic Day with a big parade.

India successfully tested last April the Agni V missile, which has a range of 5000km and can strike across the Chinese mainland and even hit targets as far away as Europe.

The first appearance in Saturday's annual parade of the Agni V - seen as marking a significant upgrade of India's nuclear deterrent - came along with the display of other expensive military hardware.

India's shorter-range Agni I and II were developed with rival Pakistan in mind, while later versions reflect India's focus on China.

India and China have prickly ties and a legacy of mistrust stemming from a brief border war in 1962.

On the eve of Republic Day, marking proclamation of India's constitution in 1947, President Pranab Mukherjee told Pakistan in his annual nationwide televised address that New Delhi's hand of friendship should "not be taken for granted".

His speech came amid a ceasefire which took hold last week in disputed Kashmir after the nations agreed to halt cross-border firing that has threatened to unravel a fragile peace process.

"We believe in peace on the border and are always ready to offer a hand in the hope of friendship... but this hand should not be taken for granted," he said.

Before the ceasefire, Pakistan said three of its soldiers died in firing by Indian troops along a de facto border dividing Kashmir between the two nations.

India, in turn, accused Pakistani troops of killing two of its soldiers, one of whom was beheaded, and the Himalayan region remains on edge.

In his speech, president Mukherjee also said it was time for India to "reset its moral compass" following the gang-rape and murder of a student last month that ignited nationwide demonstrations to press for better safety for women.

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Russia police question dancer over attack

RUSSIAN police have questioned a star dancer about an attack against the artistic director of the Bolshoi ballet Sergei Filin.

Nikolai Tsiskaridze, one of the Bolshoi's best known male principals, has been questioned, police said in a statement on Friday.

"Employees of the Bolshoi Theatre and relatives and acquaintances of Filin have also been questioned," said the statement quoted by Russian news agencies.

Tsiskaridze is the first figure to be named by police as a witness in the case.

The Bolshoi's management and Filin have blamed last week's attack on internal divisions within the company.

Tsiskaridze, a flamboyant figure with flowing black hair who regularly appears as a judge on TV talent shows, last year lashed out at the Bolshoi's leadership for not giving him enough lead roles.

The Izvestia daily said Tsiskaridze had aroused the attention of investigators with his repeated criticism of the Bolshoi management.

He has not been named as a suspect, and vehemently denied any link to the attack.

"What happened (to Filin) is horrific," Tsiskaridze told the RIA Novosti news agency while complaining of "systematic persecution" by the Bolshoi.

Filin is undergoing a series of operations in a Moscow hospital to save his eyesight and repair disfigurement from acid that hit his face.

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Egypt faces revolt anniversary protests

EGYPT is bracing for mass protests by the opposition to mark the second anniversary of the revolt that toppled Hosny Mubarak.

The opposition called for rallies against President Mohammed Morsi and his Muslim Brotherhood group, accusing them of tightening their hold on power.

The Brotherhood and other Islamists, who dominate parliament, are celebrating the anniversary of the revolt which brought them to power.

"I call on everyone to take part and go out to every place in Egypt to show that the revolution must be completed," opposition leader Mohammed ElBaradei said before Friday's anniversary.

Morsi, Egypt's first freely elected president, faces the challenge of trying to revive the economy and ease tensions between Islamists and opposition groups.

On Thursday, Morsi blamed remnants of the Mubarak regime of trying to undermine stability.

"I hope all groups will remain peaceful during celebrations," Morsi said.

"A structural reform is taking place in the state's institutions to fulfil the revolution's demands. I'm also working with the government to solve the problems of slum areas in Egypt."

About 15 people were injured in clashes on Thursday between police and protesters in Cairo.

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European stocks fall slightly at open

EUROPE'S main stock markets have fallen slightly at the start of trading.

London's FTSE 100 index of top companies jumped by 1.09 per cent to close at 6,264.91 points on Thursday, Frankfurt's DAX 30 added 0.53 per cent to 7,748.13 points and Paris's CAC 40 won 0.70 per cent to 3,752.17.

"Even a further rise in Spanish unemployment to new record highs has not been enough to dampen the mood, while a surprise drop in US weekly jobless claims to their lowest levels in five years gave markets extra momentum in the afternoon session," said Michael Hewson at CMC Markets.

In trading in New York, the Dow Jones Industrial Average was 0.67 per cent higher, while the broad Standard & Poor's 500 index had gained 0.37 per cent.

The tech-heavy Nasdaq Composite was off by a slight 0.06 per cent, although investors dumped Apple stock, which showed a loss of 10.34 per cent to $US460.86.

"A solid batch of US economic data and the passage of a vote to extend the deadline to raise federal debt had investors put aside Apple's disappointing numbers this afternoon," noted ETX Capital analyst Ishaq Siddiqi.

Sterne Agee analyst Shaw Wu added: "We don't think the Apple growth story is over but shares will likely languish until confidence is restored."

In foreign exchange trade, the European single currency climbed to $US1.3375 from $US1.3315 late on Wednesday in New York.

On the London Bullion Market, gold prices dropped to $US1,671 an ounce from $US1,690.25.

In the eurozone, private business activity hit a 10-month high in January, according to a leading growth indicator released on Thursday.

The Purchasing Managers' Index published by London-based Markit researchers, a survey of thousands of eurozone companies, logged 48.2 points compared to 47.2 points the previous month.

"The fact that this PMI data were better than expected has been sufficient to give risk appetite another fillip," said Jane Foley, senior currency strategist at Rabobank.

"However, these data continue to point to further contraction across both manufacturing and services sectors," she added, and revealed a sharp differences between the two biggest eurozone economies, with Germany showing strong improvement, while France showed a marked deterioration.

The IMF said on Wednesday that the global economy would grow slightly less in 2013 than it previously expected, held back by a weak eurozone that will stay mired in recession for a second straight year.

"Downside risks remain significant, including prolonged stagnation in the euro area and excessive short-term fiscal tightening in the United States," the International Monetary Fund said, in an economic outlook update.

The IMF projected global gross domestic product (GDP) annual growth of 3.5 per cent this year, a dip of 0.1 points from its October forecast, and 4.1 per cent in 2014.

On Thursday, Asian stock markets closed mixed despite a positive overnight lead from Wall Street and news that Chinese manufacturing activity hit a two-year high in January, traders said.

The yen retreated after a two-day rally as Japan logged a record trade deficit for last year with exports hit by the ongoing territorial spat with China and Europe's long-running debt crisis.

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Man charged with murder over WA death

A 31-YEAR-OLD man has been charged with murder over the death of a 23-year-old man after an altercation at a home in the Peel region south of Perth.

Police were called to a disturbance at a home in the Bunbury suburb of Withers about 10:45pm WST on Thursday and found the man, 23, with serious injuries resulting from a fight at a nearby address.

The injured man was taken to Bunbury Hospital where he died a short time later.

On Friday, police said they had charged a 31-year-old man from Withers with murder over the incident.

He is due to appear in the Bunbury Magistrates Court on Saturday.

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New air force raids in Damascus province

SYRIA'S air force has launched new raids on rebel-held towns east of Damascus a day after President Bashar al-Assad attended prayers at a Damascus mosque.

The army pounded opposition-held areas of battered Homs in central Syria, as it stepped up a campaign to reclaim areas of "the capital of the revolution", said the Syrian Observatory for Human Rights.

"Warplanes made several air strikes on towns and villages in the Eastern Ghouta region" near Damascus, said the Britain-based Observatory, which relies on a network of activists, doctors and lawyers across Syria for its reporting.

Eastern Ghouta is home to some of the rebel Free Syrian Army's best organised and fiercest groups.

Assad attended prayers at a Damascus mosque on Thursday in a rare public appearance to mark Prophet Mohammed's birthday.

Appearing in public for the first time since a rare speech on January 6, he was shown in a live broadcast, flanked by Grand Mufti Ahmad Hassoun, the highest Sunni religious authority in Syria, and the religious endowments minister.

In a fresh bid to find a solution to the bloody civil war, UN chief Ban Ki-moon appealed again to members of the Security Council to overcome their divisions.

And Syria's interior ministry told political opposition abroad wishing to participate in a national dialogue proposed by Assad they were "authorised" to return to the country.

Clashes pitting rebels against troops raged overnight on the edges of the Yarmuk refugee camp, which has seen frequent violence in the past few weeks, especially since two air raids in mid-December.

Once home to some 150,000 Palestinians, Yarmuk now also acts as a makeshift refuge for hundreds of Syrians fleeing violence elsewhere in the country.

"But it is no longer a safe place. Thousands of people have left the camp, Palestinians and Syrians, in search of another refuge," said Abu Omair, an activist from Damascus.

Friday's violence came a day after at least 98 people were killed across the country, among them 33 civilians, 26 soldiers and 39 rebel fighters, said the watchdog.

Meanwhile on Thursday, a jihadist suicide attacker killed at least eight military intelligence troops, said the Observatory.

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Last Vic firefighters return from Tas

THE last group of Victorian firefighters who helped battle Tasmania's worst fires in nearly half a century have returned home.

Over 70 Victorian emergency services personnel were sent to Tasmania this month to help the state fight and recover from fires that destroyed nearly 200 properties and burned through 120,000 hectares.

One of the contingent, Department of Sustainability and Environment (DSE) firefighter Peter Cramer, died while identifying potential containment lines at Taranna, east of Hobart, on January 13.

The final group of firefighters returned to Melbourne on Thursday.

Tasmania Fire Service chief officer Mike Brown thanked the Victorian contingent for their help.

"The Victorian teams fitted in very quickly and provided our people with needed support and relief," he said.

"The effectiveness of the task force speaks volumes for the consistent approach we now have to emergency management and the close relationships we have with our Victorian counterparts."

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Captain Cook's pistol set to be auctioned

NEARLY 250 years after British explorer Captain James Cook landed in Australia, his pistol is set to be auctioned in Melbourne.

The Melbourne auction house Leski Auctions on Thursday announced it would offer the Endeavour commander's Continental Flintlock holster pistol for auction next month.

Charles Leski said the pistol, which is expected to fetch between $100,000 and $200,000, provided a "tangible link" to the man who landed in Sydney in April 1770.

"There is a wealth of memorabilia available that is associated with the icons of Australia, be it Bradman, the Kelly Gang, Phar Lap, Kingsford Smith or Mawson," Mr Leski said in a statement.

"Yet James Cook, arguably the most significant of that group in terms of his impact on Australia as a nation, has left us virtually nothing."

Mr Leski said the auction house could "confidently argue" that the former captain of the Royal Navy left his DNA on the early 18th century pistol.

The lock of the pistol, which sports a 31cm long barrel, is signed "Corbau-A-Maastricht", a reference to its Dutch gun maker, Godefroi Corbau Le Jeune.

It's not the first time the pistol has been up for auction.

Mr Leski said the former Melbourne Lord Mayor Ron Walker bought it in 2003 from Cook's descendants at an auction in Edinburgh, Scotland, after it had been bequeathed to the family by the explorer and remained in their possession for more than two centuries.

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Mali's Ansar Dine splits into two factions

ONE wing of Mali's Ansar Dine rebel group has broken away from the main group, saying it wants to negotiate and is prepared to fight its former comrades.

The move indicates at least some of the members of the al-Qaeda-linked group are searching for an exit in the wake of French airstrikes.

Former Ansar Dine leader Alghabass Ag Intalla said in a statement on Thursday that the faction would be called the Islamic Movement for the Azawad, a Tuareg term for northern Mali.

The statement broadcast by French radio station RFI said the group was looking for a "negotiated solution". He said his men were willing to fight their former comrades in Ansar Dine.

An elected official from Kidal, who insisted on anonymity for fear of reprisal, told The Associated Press the split was a long time coming and reflects the fact that Ansar Dine, which took over the northern city of Kidal, succeeded in enlisting large numbers of fighters and co-opting local authorities for economic and political reasons rather than ideological ones.

Among them, he said, is Intalla, who is the heir to the traditional ruler of Kidal and who is not believed to be a radical Muslim.

"They never believed in this ideology. Now they are running for the exits," said the official, who spoke by telephone.

The split is indicative of possible disarray within the ranks of the Islamist groups which seized control of northern Mali more than nine months ago.

French President Francois Hollande authorised a military intervention two weeks ago and fighter jets have pounded rebel training camps, arms depots and bases.

Since then, the Islamists appear to have fled from the cities, although they still remain firmly in control of much of northern Mali, likely using their desert bases and the area's natural topography, including cave systems in the Kidal region.

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Vic teacher pay talks to resume

THE Victorian government and the state teachers' union have agreed to resume talks in a bid to resolve their bitter, lengthy dispute over pay and conditions.

The Australian Education Union (AEU) Victorian branch says a meeting between the parties is scheduled for Thursday January 31.

AEU Victorian branch president Meredith Peace says the resumption of talks is positive, but is warning the government it won't back down.

"The Baillieu government has dragged this dispute out for over two years by refusing to listen to the concerns of education staff, parents and the broader community," Ms Peace said in a statement on Thursday.

The Baillieu government has threatened legal action against the union, which is planning fresh industrial action from the start of the new school year.

The AEU has scheduled another mass teacher strike on February 14, as well as a ban on working beyond the 38-hour week.

Ms Peace said the AEU put a significantly revised offer of 4.2 per cent per year over three years to the Baillieu Government in November but has yet to receive a formal response.

The government has long stood by its offer of an annual pay rise of 2.5 per cent with any further increases to be offset by productivity gains.

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Perth residents on bushfire watch

A BUSHFIRE is threatening lives and homes in the northern Perth suburb of Trigg.

The Department of Fire and Emergency Services issued a watch and act warning at 5.10pm (WST) on Thursday for people on the northern side of Karrinyup Road, between West Coast Drive and Marmion Avenue/West Coast Highway.

Residents have been urged to leave their homes if the way is clear or get ready to actively defend them.

Those who are not at home are warned against trying to return as conditions in the area could be very dangerous.

Several roads have been closed, creating traffic snarls for peak hour commuters on routes including West Coast Highway between Pearl Parade and Karrinyup Road, Elliot Road, and Karrinyup Road between West Coast Highway/Marmion Avenue and West Coast Drive.

Firefighters are on the ground and in the air.

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Man, 90, found dead in Sydney pool

A 90-YEAR-OLD man has died after he was found in a backyard pool in Sydney's eastern suburbs.

Emergency services found the man in his pool at Hardy Street at Dover Heights at just before 5.30pm (AEDT) on Wednesday, a police spokesman said.

Paramedics began CPR on the man, who was not breathing, but he could not be revived.

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Hong Kong stocks edge downwards

HONG Kong shares have closed 0.1 per cent lower after hitting a 20-month high in the previous session.

Despite a positive lead from Wall Street, the benchmark Hang Seng Index eased 23.89 points to 23,635.10 on Wednesday on turnover of HK$80.89 billion ($A9.94 billion).

Chinese shares closed up 0.25 per cent. The benchmark Shanghai Composite Index rose 5.77 points to 2,320.91 on turnover of 97.0 billion yuan ($A14.84 billion).

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Cane toads and utes at NT Aust Day fun

CANE toad racing and utes may not be what springs to mind when you imagine Australia Day celebrations, but in the Northern Territory it is all part of the fun.

A huge storm threw last year's Australia Day plans in Darwin into chaos, with strong winds and rain shutting down many of the events, but in 2013 extreme weather is not expected.

For people not afraid to get out of bed in the early hours, from 7am (CST) there is a 2km or 4.5km fun run being held along The Esplanade in Darwin.

Dragonboat races, barbecues and rugby sevens action are all on offer during the day.

Among the more unusual events in the Top End are the annual Nightcliff cane toad races and the great Aussie thong throw.

With the wet season heralding mating season the toads are said to be extra jumpy, making the winner difficult to pick.

The ute run, where people decorate their cars and dogs in Australia Day themes and drive them to Darwin's Greyhound Club, will also make its return this year.

Darwin's Australia Day ambassador is Aboriginal artist John Kundereri Moriarty, who will attend a flag raising ceremony, Gala Ball and a multi-cultural celebration.

The Oz Fusion concert will be held at Marrara and will include different dancers showing off Aboriginal, Chinese, African and Irish dance styles.

Tourism NT is trying to take advantage of Australia Day, using January 26 to launch its latest marketing campaign, "Australia's Unexplored Backyard".

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European stocks edge higher at open

EUROPE'S main stock markets have gained slightly at the start of trading.

London's FTSE 100 index of leading companies rose 0.18 per cent to 6,190.02 points at the start of trading on Wednesday.

Frankfurt's DAX 30 index rose 0.09 per cent to 7,702.92 points and in Paris the CAC 40 climbed 0.06 per cent to 3,743.07.

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Australian men held over Thai shooting

TWO Australian men have been arrested in Phuket over the accidental shooting of two German tourists.

A Department of Foreign Affairs and Trade spokesman confirmed John Edward Cohen, 33, from NSW, and Adam Lewis Shea, 26, from Tasmania, had been arrested in connection with the shooting.

Cohen, a long-time resident of the island, allegedly fired a pistol and accidentally hit the tourists at Patong Beach on Tuesday, they said.

The Phuket Wan newspaper said Johann Baschenegger, 41, was admitted to hospital in a serious condition.

Joseph Woerner, 71, was in a satisfactory condition.

Police said the shooting occurred around 7.45pm near the Baan Pirin Hotel where the Germans were staying.

The Australians allegedly fled after the shooting but were tracked down to a local bar.

Both men are reported to have links with a motorcycle club known as the Rebel MC.

Lawyers were on Wednesday trying to have the men released on bail.

Officials said the Australian men were receiving consular assistance.

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Defence works on regional engagement

AS Australia prepares to withdraw troops from East Timor, the Solomons and Afghanistan, the Australian Defence Force (ADF) is working on renewing its engagement with Asia-Pacific nations, Defence chief David Hurley says.

General Hurley refused to comment on the content of the upcoming Defence White Paper, due for release in the next few months.

But he said issues which prompted the government to commission the White Paper earlier than scheduled, including the end of long-running defence operations, would obviously feature in the new strategic document.

General Hurley said the headquarters Joint Operations Command had devoted much time over the last year in revamping and renewing the campaign plan for defence engagement in the region, and new frameworks had been put in place.

"We are not rediscovering the northern region but being able to build up our interaction," he told an Australian Strategic Policy Institute (ASPI) function in Canberra.

General Hurley said defence had maintained a very high operational tempo for the last decade but would end East Timor and the Solomons operations this year and reconfigure deployments in the Middle East.

He said a key task for 2013 was resetting the ADF for the future and keeping it at a level of capability that would still allow it to respond to a government requirement to deploy troops somewhere in 48 hours.

General Hurley said at a time when the defence budget was under severe pressure, one reason to engage with the region was that it was far more expensive in the long run having to fall back on using defence capabilities.

"We have got to put the money where we are going to get the best bang for the buck at the moment and part of that will be shaping our environment and building up relationships and confidences in the region," he said.

General Hurley said defence was also rethinking how it operated in the Pacific, conducting the first meeting of south-west Pacific nation defence chiefs last year.

"We got that group together to say 'okay, how do we reshape the dollars we have all got, to do the best we can in terms of search and rescue, assisting with maritime security tasking, counter-piracy, the fishing industry'. We actually dragged Chile into that as well," he said.

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Japanese hostage describes Algeria terror

A JAPANESE hostage who narrowly survived the armed attack on an Algerian gas plant says he was sure he would die after seeing two colleagues shot dead in front of him.

The unnamed man described in a newspaper report on Monday how Islamist gunmen had dragged him from his barricaded room, handcuffed him and executed two hostages standing nearby.

In a chilling account of his escape, published Monday in the Daily Yomiuri newspaper, the Japanese hostage told colleagues he had been on a bus when it was attacked by a group of heavily-armed militants in the Sahara desert early Wednesday.

Seven Japanese are known to have survived the three-day assault, which ended in a bloodbath on Saturday - all of them connected to Japanese plant builder JGC.

The man said he was leaving a lodging house with other foreign workers in a convoy of buses when militants first swooped, according to JGC spokesman Takeshi Endo.

As the vehicle in front was hit by a hail of bullets, the driver of his bus slammed the vehicle into reverse and tried to flee.

But a wheel snapped off, stranding the bus and forcing passengers to run through the desert and seek refuge at the workers' formerly-secure lodging house.

The man barricaded himself in his room and cowered with the lights off, as gunmen began their rampage through the compound.

But a short time later the door splintered open as militants shot the lock apart and burst in, plucking the frightened man from his hiding place and clamping handcuffs on him.

He was frogmarched to a bright room with other foreign hostages where his captors began speaking Arabic with some of his Algerian colleagues.

The next thing he knew someone opened fire and two people slumped to the floor, dead, in front of him.

"I was prepared to die," Endo quoted the employee as saying.

The bodies of other foreigners lay on the ground as he and a Filipino colleague were bundled into a vehicle and driven off towards the gas plant.

Without warning the vehicle was sprayed with bullets, which pierced the windshield and forced the prisoners to duck down as low as possible to avoid being shot.

As their captors abandoned the vehicle the prisoners were left alone, not knowing who had opened fire.

In the hours that followed the Japanese survivor hid under a truck, trying to stay away from the gun battle that raged around him. As bullets flew past he saw a bus full of hostages -- some wearing JGC uniforms -- drive past.

He watched with horror as the vehicle came under attack, but said he had no idea of the fate of those on board.

After nightfall, when the shooting had stopped he began trudging through the desert, walking for an hour before he came across Algerian soldiers and safety.

Japan's Mainichi Shimbun newspaper reported it had spoken to an Algerian man who was taken hostage with about 20 foreign nationals, including six Japanese.

He said the foreigners were forced to link arms and then had their wrists and ankles bound with plastic ties, effectively forming a human chain.

The militants then wrapped explosives around their captives' bodies.

He said hostages were allowed to use the lavatory and were offered food, but none of the Japanese accepted because they were too scared.

The 45-year-old said he had made his escape on Thursday when the Algerian military staged its first assault.

He said he and other Algerians had run in the confusion, but the foreigners could not get away.

"I don't know what happened to them afterwards. I hope they survived," he was quoted by the Mainichi as saying.

JGC, which has 78 employees in Algeria, said Monday morning 17 of its employees who were at the plant are still unaccounted for -- 10 Japanese and seven others.

Witnesses have said nine Japanese people were killed in the 72-hour ordeal.

JGC spokesman Takeshi Endo told reporters in Japan that employees who were in the plant at the time of the siege but managed to escape before being taken hostage would help to identify anyone in the hospital.

"We were cautious about asking them to do this tough job, but they agreed to do it and as they were working closely with the colleagues who are still missing, it will surely be helpful," Endo said.

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Five seriously hurt in Austria train crash

TWO packed commuter trains have collided head-on in the morning rush-hour traffic in Vienna, leaving five people seriously hurt.

"At the moment there are five people seriously injured and several people with light injuries," emergency services spokeswoman Claudia Gigler told AFP on Monday.

The Austrian automobile association said one person was trapped inside the wreckage.

Many passengers were suffering from shock.

Gigler said the cause of the crash was not known.

Austrian Railways spokeswoman Sarah Nettel said that the crash occurred at 8.45am (1845 AEDT) in the Penzing district of western Vienna.

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US ship ignored reef warnings: Philippines

A PHILIPPINES official has accused a US Navy minesweeper of ignoring warnings to stay away before it became stuck on a World Heritage-listed coral reef.

The accusation on Monday by the superintendent of Tubbataha marine park, Angelique Songco, added to growing anger in the Philippines over the incident.

The US Navy has apologised but may still face fines.

Park rangers radioed the USS Guardian to say it was nearing the Tubbataha Reef on Thursday, but the captain insisted they raise their complaint with the US embassy, Songco told reporters.

She said shortly after the warning, the 68-metre vessel became stuck on part of Tubbataha Reef, a UNESCO World Heritage Site on the Sulu Sea about 130 kilometres southeast of the western island of Palawan.

The site is protected by Philippine law, and is off limits to navigation, except for research or tourism approved by Songco's office.

Songco said it was too early to assess the damage to the coral.

The vessel was still stuck on the reef and being battered by big waves.

The commander of the US Navy's 7th Fleet, Vice Admiral Scott Swift, apologised in a statement from Japan on Sunday.

"As a protector of the sea and a sailor myself, I greatly regret any damage to this incident has caused to the Tubbataha Reef," Swift said.

He acknowledged that protecting the reef was vital, and that the navy took its obligations to preserve marine environment seriously.

He said the crew members had left the vessel, and there were no traces of any oil leaks.

The Philippine Navy said three of its ships had been put on standby near the area to assist in efforts to remove the Guardian from the reef. Two civilian tugboats had been contracted by the Americans.

The Guardian had been en route to Indonesia after visiting a Philippine port north of Manila when the incident occurred, according to the US Navy.

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NATO joins fight against Taliban squad

NATO troops have helped liberate a Kabul police building from a Taliban suicide squad.

Three police officers died in the attack, which lasted eight hours on Monday.

The Taliban claimed responsibility for the attack, which was the longest stand-off between the insurgents and security forces in Kabul since a major co-ordinated raid on the capital lasted 18 hours in April 2012.

Three of the five attackers were killed in the early part of the assault while two others wearing suicide vests holed up in the five-storey police building in west Kabul fired on security forces, a police officer told AFP.

They were later also killed.

"It's over. The last two terrorists are dead and they were not even given the chance to detonate their suicide vests," Kabul police chief General Mohammad Ayoub Salangi told AFP.

The reason it took so long to overpower the last two men was "because our boys acted very carefully," he said. "There were lots of important documents so we acted very carefully to not cause any damage to those documents."

Four traffic police, two members of the special forces and half a dozen civilians were wounded, deputy interior minister General Abdul Rahman said.

An AFP photographer said Norwegian soldiers were seen firing at the police building.

NATO's International Security Assistance Force (ISAF) confirmed its participation in the operation but insisted it was small.

"We do have a very small number of people assisting the Afghan security forces officials at the scene. It's primarily an advising role and absolutely the Afghan officials are in the lead," an ISAF spokesman told AFP.

NATO says the Taliban insurgency has been weakened and characterised the attack as a ploy to attract media attention, but the time it took to mop up the insurgents will be seen as an embarrassment.

"They (the Taliban) are losing the fight," said General Gunter Katz, ISAF military spokesman.

"They cannot fight face to face. These attacks are only to attract media. They carry out their attacks in the cities and crowded areas where civilians suffer."

He praised the role of the Afghan security forces in countering the attack.

The assault began with a massive car-bomb explosion that shattered the windows of nearby homes.

A local resident described the initial explosion as "very very big - it was massive". It was followed by several other explosions and gunfire.

Taliban insurgents, who are waging an 11-year war against the Western-backed government of President Hamid Karzai, claimed credit for the attack, which it said began at 5:00 am (2330 AEDT Sunday).

"A large number of fedayeen (suicide bombers) entered a building in Dehmazang and are attacking an American training centre, a police centre and other military centres and have caused heavy casualties on the enemy," a Taliban spokesman said.

There is no US or NATO-run training facility in the area and the Taliban are known to exaggerate when claiming attacks.

Monday's attack came less than a week after a squad of suicide bombers attacked the Afghan intelligence agency headquarters in Kabul, killing at least one guard and wounding dozens of civilians.

All six attackers were killed in the brazen attack on the National Directorate of Security (NDS), also claimed by the Taliban.

Afghan police and other security forces are increasingly targets of Taliban attacks as they take a bigger role in the battle against the insurgents before NATO withdraws the bulk of its 100,000 combat troops by the end of 2014.

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Snow causes chaos in China

Snow in northern China has forced the cancellation of over 100 flights and the closure of highways. Source: AAP

SNOW in northern China has forced the cancellation of more than 100 flights and the closure of dozens of highways, authorities say.

Beijing Capital International Airport's official website said on Sunday a total of 111 flights were cancelled at the facility, including 16 international ones.

Another 68 flights were delayed, with 11 of those on international routes.

More than 40 highways in northern China were closed due to the snow, the government's official weather website said. No accidents were reported.

As of 8:00 am Sunday weather authorities recorded up to 8.6 centimetres of snow in a mountainous part of northwestern Beijing near the Great Wall of China.

Much smaller amounts fell in central Beijing and had largely stopped by Sunday afternoon.

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Dotcom re-enacts raid for launch party

A HELICOPTER fly-by, men dressed as armed New Zealand police officers, and dancers and singers have all heralded the launch of Kim Dotcom's new "legal" website, Mega.

The new cloud storage website went live at 6.48am on Sunday, about the same time as the dramatic police raid on his Coatesville mansion got underway a year ago. He and three others were arrested on that occasion.

To celebrate the new website's launch, Dotcom hosted about 200 invited guests and media at a party and press conference at the mansion, north of Auckland.

Dotcom, speaking from a stage constructed on the forecourt of his home, told the crowd more than one million people had visited Mega within 14 hours of the site's launch and about 500,000 people had registered as users.

"The launch of Mega is not about mocking any government of Hollywood, it is about our right to innovate and start a new business," he said.

"What we are offering is a smarter, faster and more secure way of cloud storage and we are fully assured by our legal team that we are in compliance with the law."

The press conference, which was also streamed online, included a reenactment of the police raid, with men repelling down the sides of the house and a helicopter, with FBI emblazoned on the side, flying over the crowd.

Dotcom paid tribute to the support he's received from Kiwis in the year since his arrest on copyright infringement, racketeering and money laundering charges related to the file-sharing site Megaupload.

"During the past year we had great support from New Zealanders; you have reached out to us and your voices have empowered us," he said.

Dotcom and his co-accused are still awaiting a court hearing to determine whether they will be extradited to the United States.

The extradition hearing, which has been delayed several times, is expected to take four weeks and is set down for August.

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Indian media hails Gandhi's promotion

Indian newspapers are trumpeting the elevation of Rahul Gandhi in the ruling Congress party. Source: AAP

INDIAN newspapers are trumpeting the elevation of Rahul Gandhi to second-in-command of the ruling Congress party and predict a showdown for the position of prime minister with opposition rival Narendra Modi.

"Party finally crowns prince," headlined the English-language tabloid Mail Today over a full-page spread that featured a smiling picture of the 42-year-old on Sunday.

The son, grandson and great-grandson of Indian prime ministers is now second in the party's hierarchy after his mother, party president Sonia Gandhi, who led the party to back-to-back victories in the 2004 and 2009 polls.

The move indicated that the Congress party was "not averse to pitting him against Narendra Modi and fielding him as its prime ministerial candidate," the Mail said.

"The party, it is evident, now feels that it will be in an advantageous position... in case of such a battle."

Gandhi was on Saturday formally named as the vice-president of the party, propelling his long-anticipated accession to power and paving the way for him to lead the party in general elections next year.

The Times of India said the stage had been set for a possible showdown between Gandhi and Modi, a hardline leader of the right-wing Bharatiya Janata Party (BJP) who is widely expected to run for prime minister in 2014.

"As number two in the Congress, he has been, for all practical purposes, pitched as the prime minister candidate of the party... thus setting the stage for a showdown with the Gujarat strongman," it said referring to Modi.

The BJP -- which is the main opposition party in parliament -- is yet to name a candidate to take on the Congress-led alliance but clamour is growing for Modi to be pitched for the prime ministership after he won key state polls last year.

The Hindustan Times said the Congress had stopped short of naming Gandhi as the candidate for the country's top job "perhaps out of consideration for its sitting octogenarian PM Manmohan Singh".

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Union slams privatisation of hospital pool

Staff at Sydney's Prince of Wales hospital will stop over moves to privatise the hospital's pool. Source: AAP

THE Prince of Wales Hospital in Sydney is set to meet budget cuts by privatising its hydrotherapy pool but outraged union members claim it will jeopardise patient care.

Health Service Union (HSU) staff will stop work to protest the move at midday on Monday, said the union's NSW secretary Gerard Hayes on Sunday.

"How can patients at the Prince of Wales have confidence that their recovery will be the priority when a new private operator has commercial objectives to meet?" he said.

Mr Hayes said the pool "sell-off" would provide part of the $35 million in savings the hospital must find to meet the NSW government's $3 billion in health cuts.

It's believed it is the first move of its kind in NSW.

The hour-long protest at High Cross Park also marks the official launch of the HSU's "O'Farrell Cuts, We Bleed campaign", which will travel across the state for the next six months.

"Daily, our members are reporting cuts like these ones," Mr Hayes said in a statement.

The union is using the privatisation of the hydrotherapy pool as an example of how cuts to the health budget will devastate staff and patients.

Mr Hayes said the facility was crucial for people suffering cerebral palsy, post-polio syndrome, musculoskeletal conditions and breast cancer.

"Yet the O'Farrell government wants to turn the pool over to a private operator, whose main imperative will be to turn a quick buck," he said.

"We intend to fight him on this, every step of the way."

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Vic residents return to bushfire-hit homes

Victorian residents have returned to their bushfire-ravaged homes as fire crews backburn. Source: AAP

RESIDENTS have returned to their bushfire-damaged homes in Victoria's east, as authorities battle to bring a massive blaze under control before more predicted hot weather.

Firefighters took advantage of Sunday's cooler weather to strategically backburn amid fears towns could again be threatened on Thursday.

The massive 56,000-hectare blaze has already killed one man who was found in a burnt-out car and destroyed at least 21 homes since it began in the Baw Baw National Park last Thursday.

There are fears the fire may have been deliberately lit.

Residents in Seaton, Glenmaggie and Glenmaggie Point have returned home.

Glenmaggie resident Peter Monds, a CFA member, was manning phones at a control centre when his home was destroyed.

Inside his uninsured home were many photos and memories.

"There's no good crying about it," he told the Nine Network.

"It's gone, it's gone."

Authorities say 21 houses, 35 sheds and 11 vehicles have been lost in the fire and the fire could go for two weeks.

The fire was threatening the small hamlet of Licola, but it has been held about 15km from the town.

Firefighters began a 180 hectare backburn about 10am (AEDT) on Sunday.

Incident Controller Michael Masters said the CFA and DSE were doing a joint backburn due to the likelihood of a very high fire weather day predicted for Thursday.

"The risk of high temperatures and a north westerly wind poses a very significant risk to the Aberfeldy-Donnely bushfire breaking containment lines if we don't backburn today," he said in a statement.

Mr Masters said the 180 hectare backburn would reduce fuel loads in an unburnt area 5km south of Glenmaggie and 6km northwest of Heyfield.

Fire crews are also working on the eastern perimeter in the Coongulla state forest north east of Glenmaggie to strengthen containment lines.

Police are appealing for people to come forward if they witnessed anything suspicious in the hours before the blaze started at Aberfeldy in Gippsland about 11.30am on Thursday.

They particularly want to speak to anyone who was camping in the Donnelly Creek Road area on Thursday morning or local residents.

Smoke from the bushfires reached Melbourne on Sunday and could be smelt in the CBD air.

Authorities have urged the public to ensure there is actually a bushfire in their area before reporting it to Triple-0.

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