Pakistani Jets Pound Taliban Stronghold Following Karachi Airport Siege

A member of the Bomb Disposal Squad (BDS) places hand grenades in a line after defusing them along a sidewalk outside Jinnah International Airport in KarachiReuters

Pakistani jets have launched a deadly air strike on a Taliban stronghold near the region bordering Afghanistan killing at least 15 suspected militants following the high-profile siege at the Karachi international airport.

F-16 fighter planes pounded the areas of Kokikhel in Tirah valley, thought to be insurgent hideouts.

It is not yet known whether the aerial attack is retaliation for the airport attack, which was claimed by the Tehreek-e-Taliban Pakistan or the Pakistani Taliban.

A statement from the military said nine hideouts were targeted and destroyed in the attack.

Helicopters and fighter planes have been on an aerial mission targeting Taliban extremists in the region after the peace talks with the militant group failed to yield any results.

The latest military assault has come a day after the outfit staged an audacious attack on Pakistan's largest and busiest airport in Karachi killing at least 30 people.

The authorities have recovered seven bodies of victims who were trapped inside a room during the militant attack.

"We are looking into this and according to the families some seven people were trapped inside the cold storage and were in contact with the families on cell phone," said Abid Qaimkhani, a spokesperson for the Civil Aviation Authority.

They are believed to have died due to suffocation and the bodies are beyond recognition, said officials. Post-mortem is to take place shortly.

Philippines Investigates China's Artificial Island Plan in South China Sea

Members of a Filipino military detachment stationed aboard the BRP Sierra Madre at the disputed Second Thomas Shoal, part of the Spratly Islands, in the South China SeaReuters

The Philippines said it was probing reports that China has been reclaiming land in disputed waters in the South China Sea and turning reefs into artificial islands.

Manila said it was looking into media reports that Beijing was planning to expand one of its installations in the Spratly Islands to include an airstrip and port and reclaiming land from several other contested reefs in the area.

"If the report is true, very clearly... China intends to alter the status quo and change the character of the feature," Philippine foreign affairs spokesperson Charles Jose told ABS-CBN News Channel.

Jose was commenting on the possible expansion of Chinese installations on the Fiery Cross Reef. He added that if the report was to be confirmed true, manila would lodge a formal protest.

China's claim over virtually the entire South China Sea has caused growing tensions with its southern neighbours.

The Spratly Islands are a resource-rich archipelago of reefs and atolls west of the Philippines, parts of which are claimed by Manila and Beijing as well as Vietnam, Malaysia, Brunei and Taiwan.

A map of the Spratly Islands in the South China SeaReuters

Over the weekend, Hong Kong newspaper the South China Morning Post (SCMP) reported that China's central government was vetting plans to turn the Fiery Cross Reef into a large artificial island to serve as military hub for Beijing's expansionist policy in the area.

The reef already hosts a number of Chinese-built facilities including an observation post commissioned by Unesco's Intergovernmental Oceanographic Commission.

As part of a $5bn (£3bn) project, the reef will be reportedly expanded to form an island double the size of the 44-square-kilometre US military base of Diego Garcia in the Indian Ocean, and fitted with a landing strip and a 5,000-tonne berth.

A retired People's Liberation Army senior colonel told SCMP that Beijing was to use the base to enforce an air defence identification zone over the South China Sea.

Chinese vessels are reportedly already engaging in land reclamation activities at other reefs in the archipelago.

The Philippine Daily Inquirer published photos taken by the Philippine military, allegedly showing Chinese ships gathering filling materials off the Malvar Reef.

Earlier, President Benigno Aquino claimed that Chinese vessels, possibly carrying land reclamation equipment, had also been spotted near the Cuarteron and Gavin reefs.

A spokesperson for President Benigno Aquino said: "Certainly, we do not want to escalate any tensions in the South China Sea," presidential spokesman Edwin Lacierda said. "The best thing that we can do is to resort to the diplomatic mechanism."

India Could Raise Foreign Investment Limit in Government Debt by $5bn

India could raise foreign investment limit in government debt by $5bn.Reuters

New Delhi could raise the foreign investment limit in government debt soon, as almost all the available allocations have been taken up by overseas buyers, according to a media report.

Prime Minister Narendra Modi's government could raise the amount foreign investors are allowed to buy by $5bn (£2.9bn, €3.6bn).

The finance ministry will decide on the matter after talks with the Reserve Bank of India (RBI) and markets regulator Securities and Exchange Board of India (Sebi), unnamed sources told Reuters.

The 10-year benchmark bond yield shed 3 basis points to 8.49% following the news.

Standard Chartered said in a note to clients: "Our Indian government bond (IGB) positioning indicator (SIGMA) for May increased to -2.25 from -3.05 in April, providing a bullish signal for duration in June. On our scale, -5.00 indicates the maximum position of accumulated net selling by active investors in the past six months.

"The pattern of market activity in May reversed for foreign banks, which turned net buyers of IGBs from being net sellers in April. Mutual funds remained net buyers, and primary dealers reduced their net selling of IGBs in May. We have a Positive outlook on IGBs on attractive carry for foreign investors and a relatively dovish central bank."

Existing Cap

The current cap is 995.46bn rupees ($16.85bn).

As of 6 June, foreign investors owned 886bn rupees worth of government debt, or 89% of the available allocation – the surge in inflows followed Modi's election victory.

When the limit hits 90%, foreign investors are allowed to buy debt only through an auction, widely considered as inconvenient.

The renewed interest in Indian government debt comes on the back of hopes that Modi will be able to push through sweeping reforms, such as expediting investments and clearing infrastructure projects, to boost an economy suffering its worst slowdown in more than 25 years.

New Delhi last raised the amount of government debt that foreign investors can buy, by $5bn, in June 2013.

Malaysia's Najib Razak Opens Door to Foreign Finance

Malaysia's Prime Minister Najib Razak gives a keynote address at the Invest Malaysia 2014 in Kuala Lumpur.Reuters

Malaysia's Prime Minister Najib Razak has announced plans to remove obstacles faced by foreign fund managers and ease ratings requirements for the corporate bond market, in a bid to attract investors.

The moves, according to Najib, are also aimed at encouraging a "stable and inclusive" financial system in Malaysia, which aims to attain developed nation status by 2020.

Najib on 9 June declared that foreign firms will be allowed to wholly own unit-trust management companies in Malaysia with immediate effect - a move market players said will give foreign fund managers a broader access to the nation's retail investors.

Najib, speaking at the two-day Invest Malaysia 2014 conference in Kuala Lumpur, also announced that beginning in 2017, Malaysia will remove mandatory requirements for domestic firms to obtain credit ratings on the corporate bonds they issue.

He also said that international credit rating agencies with full foreign ownership will be allowed to operate in Malaysia from January 2017 onwards.

"There will be no barrier to entry for new foreign unit-trust management companies coming into Malaysia," Najib said, according to media reports.

"The entry of international agencies will further enhance the quality and standard of rating services, introduce a more competitive fee structure and widen both expertise and the range of credit rating services on offer," he added.

Malaysia's annual GDP growth picked up in the first-quarter, to its fastest in more than 12 months, supported by consumer spending and a turnaround in exports.

Gross domestic product jumped 6.2% in the three months to 31 March, 2014, as against a 5.1% increase in the year-ago period.

India: Five Bodies of Hyderabad Students Washed Away in Beas River Recovered

A file photo of Beas River in Himachal PradeshWikimedia Commons

Authorities have recovered five bodies, including those of two girls, while 19 others remain missing after they were washed away in the mighty Beas river in the popular tourist destination of Manali, Himachal Pradesh, in north India.

The tragedy occurred when the students, who were taking pictures of themselves standing on the river's edge, were swept away by a massive surge of water after the floodgates of the reservoir were opened.

Most of the victims were engineering students from the south Indian city of Hyderabad who were on an excursion.

A staff member and a tourist guide are also unaccounted for.

Rescue measures are under way to find the missing students, but the chances of finding them alive are considered bleak because of strong currents and silt. One of the bodies was found 20kms downstream.

Troops, divers and other security personnel have been drafted in to comb the river.

"I tried calling out to my friends... but couldn't. They also saw the water level rising, I tried helping a few of them, but in a span of six seconds, the water level rose to five or six feet in front of my eyes, they drowned," Ravi Kumar, one of the students who escaped the tragedy, told NDTV.

"Spoke to Minister of Education Himachal Pradesh Shri Bali re [SIC] the tragic incident of 24 engineering students feared washed away near Mandi," tweeted Union Human Resources and Development Minister Smriti Irani.

Locals are furious that there was no warning prior to the release of the water, but authorities say the siren went off before it was released.

A case of negligence has been registered.

Modi Plans Vibrant India Global Investors' Summit

India's Prime Minister Narendra Modi

Narendra Modi, the newly-elected Prime Minister of India, is planning to hold a mega event in November to attract foreign investment into the country.

A proposed Vibrant India global investors' summit, which is modelled along the lines of the Vibrant Gujarat summits that enhanced the image of Modi as a business-friendly chief minister of the state of Gujarat, is likely to take place close to the 4-6 November period, the Economic Times reported.

The World Economic Forum (WEF) is due to hold its annual India show around the same time.

Government officials are working closely with the Confederation of Indian Industry (CII) and other business associations for the summit, according to the report.

"Some discussions have happened but nothing is formalised as yet," the newspaper quoted CII's director general Chandrajit Banerjee as saying.

"Expectation levels are going up. Investors think India is a good investment destination again."

Banerjee noted that "there is a lot of international interest and positivity around India" and that there have been inquiries from countries such as Japan.

An official in the Prime Minister's Office said the November date is suitable since it coincides with WEF's India show and, given Modi's schedule, that's the appropriate time.

"With election manifestos coming alive as early policy reforms, the meeting will serve as a milestone, offering the first opportunity for the Forum's global multistakeholder community to meet the new government and together define and shape the country's next round of transformation," the WEF said earlier in a statement about the event in India.

After Modi was elected, foreign institutional investors had pumped billions of dollars into Indian securities, expecting greater returns as the country headed towards its much needed economic reforms.

Modi's business-friendly attitude has helped change foreign investors perception about India, and the government is looking to capitalise on favourable sentiment.

Opec 'Relaxed' About 30 Million Barrels-Per-Day Target

Opec Expected to Hold Onto 30 Million Barrel-Per-Day Production CeilingReuters

The Organization of Petroleum Exporting Countries (Opec), whose dozen member nations together supply almost a third of the world's crude, is expected to hold on to its output target of 30 million barrels per day when it meets on 11 June in Vienna.

"I don't see anything changing in terms of the 30 million barrels-per-day target," an unnamed OPEC source told Reuters. "It should be a fairly relaxed meeting."

Opec's output is in line with the target and the cartel seems satisfied with existing crude oil prices, which have hovered above $100 this year.

However, energy market watchers believe Opec could find it tough going to meet its targets. It depends on a range of variable such as, an easing of sanctions on Iran to allow the Islamic republic to export more crude, if output from crisis-struck Libya recovers, if Iraqi export growth persists and the Ukraine crisis abates.

In addition, America's shale oil boom could eat into the cartel's market share 2015 onwards, probably leaving hardly any room for Opec to raise its output target in 2015.

Iran, Opec's second-largest producer before being beaten by Iraq in 2012, can boost output by some 600,000 bpd a few months after a lifting of sanctions, reported Reuters. The International Energy Agency's (IEA) monthly report in April suggested Iran was exporting some 1.65m bpd, exceeding the one million bpd limit imposed by world powers in a temporary agreement.

Elsewhere, around 10 months of protests at oilfields and export terminals in Libya has pulled down oil production to around 200,000 bpd from a pre-crisis high of 1.4 million bpd. Separatists have seized and occupied ports in the country's east while a wave of protests has halted production at a number of key oil facilities.

In Iraq, a recently opened export terminal in the south has boosted capacity by 800,000 bpd.

Meanwhile, Europe relies on Russia for around a third of its gas needs, 40% of which travels through Ukraine.

"It should be a very quick meeting," said Bill Farren-Price, head of energy consultancy Petroleum Policy Intelligence, of Opec's meeting.

"Prices are very stable and in a comfortable place ... China has been importing more crude than expected ... and the Ukraine crisis has helped keep the price underpinned," Farren-Price told AFP.

India Gang Rape: Dalit Girls Raped and Lynched 'May Have been Victims of Honour Killing'

Two girls are seen hanging from a tree in a village in the northern Indian state of Uttar PradeshReuters

Two teenage girls who were gang-raped and then hanged from a mango tree in the Indian village of Katra, Uttar Pradesh state may have been victims of honour killing, local officials have said.

The two cousins, aged 14 and 15, had gone out one evening to relieve themselves in the fields where they had been allegedly attacked by five men who raped and killed them.

After the brutal murder, three suspects - along with two policemen accused of inaction - were arrested, while two are still on the run.

In the latest developments in the incident that has sparked global outcry and shed light on the largely unpunished culture of rape in India, it emerged that the two girls might have been killed by their families in an honour killing.

According to head of police in Uttar Pradesh, only one of the girls had been raped and the five men sought for their murder may be innocent.

"We are suspecting there could be a different motive to the murders and the crime is of a different nature," Director General of Police A.L Bannerjee said.

He said new evidence had cast suspicion on the girls' relatives who will now be required to undergo "narco-analysis" - a form of lie detector test where suspects are interviewed while under the influence of so-called "truth drugs".

Ranjana Kumari, a leading campaigner for women's safety, decried the comments by the state police chief, saying they could only serve to ease the pressure on the Uttar Pradesh government and police, largely accused of failing to act after the atrocity took place.

"The police is making contradictory statements and are creating further confusion," Kumari told the Telegraph. "The world is watching us and it seems that the statements are politically motivated."

The victims belonged to the Dalit group - a low class, according to the rigid caste system practised in India.

Honour killing is widespread in India

Honour killing is widespread in India, where at least 1,000 killings take place every year.

However, the official statistics might not reflect the real figures as such crimes often go unreported.

The killing occurs when someone supposedly acts in a way that brings shame upon their family. The murder is carried out in order to restore the family's dignity.

Soutik Biswas, online correspondent for BBC News in India wrote on his blog:

"You can get killed for falling in love in many parts of India. Especially, if you or your lover - and sometimes spouse - 'defy' the preordained rules of the country's fiendishly complex caste system.

"You can invoke the ire of your family and community and get killed if you marry within your caste, outside your caste, within your sub-caste and so on. You can also get killed for marrying outside your religion."

Hot Shots Photos of the Day: Miss USA, Psychic Fish, Pole Dance Day

Papier-mache pandas, created by French artist Paulo Grangeon, are displayed in the arrival hall at Hong Kong airport. The city is the latest stop on the 1600 Pandas World Tour, highlighting a 2004 survey which found there were only 1,600 pandas left in the wildReuters

A team of Samurai Blue surgeonfish representing Japan and a squad of orange clown fish representing the Ivory Coast compete for a bait-filled ball at the Yokohama Hakkeijima Seaparadise amusement park in Japan. A blue 'striker' eventually pushed the ball into a goal, predicting a World Cup win for JapanAFP

Tourists pose for photos at the statue of Christ the Redeemer ahead of the 2014 World Cup in Rio de JaneiroReuters

A child poses for a family picture in front of the statue of Christ the Redeemer in Rio de JaneiroReuters

Andy Jones of the USA dives from the 28-metre platform at Hells Gate during the second stop of the Red Bull Cliff Diving World Series at Possum Kingdom Lake, TexasGetty

A woman performs a pole-dancing routine on a lamp post in Mexico City during national Urban Pole Dance DayReuters

People form a traditional 'Castell' or human tower in front of Tower Bridge in a bid to draw international attention to a referendum on Catalan independence on 9 NovemberAFP

A soldier from the royal guard lies on the ground after fainting as guests were arriving for Princess Leonore's christening at the Royal Chapel in Drottningholm Palace near StockholmAFP

Rafael Nadal celebrates match point in his French Open men's singles final match against Novak Djokovic at Roland Garros in ParisGetty

Jo Harten of the team Waikato Bay of Plenty Magic competes with Sharni Layton of the Sydney Swifts during their ANZ Championship Minor semi-final netball match in SydneyGetty

Fellow contestants embrace Miss Nevada Nia Sanchez after she won the 2014 Miss USA beauty pageant in Baton Rouge, LouisianaReuters

Miss Nevada Nia Sanchez takes the runway during the swimsuit section of the 2014 Miss USA beauty pageant, and is crowned by Miss USA 2013 Erin Brady after winning the 2014 Miss USA beauty pageant in Baton Rouge, LouisianaReuters

Rowers take part in the Vogalonga, or Long Row on the Grand Canal and the Venice lagoonReuters

An aerial view shows people on the beach of the Wannsee lake in Berlin, GermanyAFP

An overturned truck is seen after a road was washed away by flood waters in Boca del Rio, after Tropical Depression 90-L brought torrential rain to the states of southern MexicoReuters

Flames illuminate smoke rising from the Karachi airport terminal after heavily armed militants attacked Pakistan's busiest airportAFP

Pakistani policemen display seized weapons after militants attacked Jinnah International Airport in KarachiAFP

Week Ahead: UK, Eurozone, US and China Data to Determine Global Stock Market Direction

The Week Ahead: Global markets to take cues from UK, Eurozone, US and China dataReuters

Global markets will this week take their cues from a raft of data including labour market figures from the UK, the eurozone's Sentix sentiment index and industrial production, US retail sales data and China's industrial output measure.

They will also be tracking central bank rate decisions in Iceland and New Zealand.

The UK puts out its unemployment rate on 11 June, forecast to ease to 6.7% in April from 6.8% in March, fuelling speculation about when interest rates could rise.

Central Bank Lookout

Elsewhere, Iceland's central bank announces its rate decision on 11 June.

Capital Economics said in a note to clients: "The small fall in Icelandic GDP in the first quarter of 2014 was somewhat disappointing but we do not think that this marks the start of a renewed deterioration in the economy.

"Nonetheless, the steady improvement in domestic demand bodes well for the overall economic recovery. As a result, the output gap is likely to be closed this year, despite the weaker economic performance in Q1."

"Accordingly, while we think that Iceland's central bank will stand pat at its meeting next week, we still expect it to raise rates by 25bp later this year to 6.25%," Capital added.

New Zealand's central bank will reveal its rate decision on 12 June.

Commerzbank Corporates & Markets said in a note: "The RBNZ is likely to hike its key rate further, from 3% to 3.25%, with the economy growing at a strong rate and capacity utilisation rising. Whether the next steps will be implemented as announced will mainly depend on the NZD exchange rate as its high value and falling import prices are dampening inflationary pressure.

"In early May, Governor [Graeme] Wheeler reiterated that he considers the currency to be over-valued, signalling interventions if the currency were not to react to softer data such as tumbling export prices. The NZD has depreciated since but the low level of interest rates world-wide and the general hunt for yield are limiting corrections - and therefore the RNBZ's scope. We expect it to adjust interest rates only once more in H2."

In the UK, the Mansion House dinner in London on 12 June will give Bank of England (BoE) Governor Mark Carney an opportunity to comment on how to soothe housing market hot spots, particularly London.

A key focus on 12 June will be US retail sales data for the month of May. Retail sales in the world's largest economy are expected to rise 0.6% month-on-month after slowing to 0.1% in April, following strong gains in March and February.

BOJ Stimulus

On 13 June, the Bank of Japan (BoJ) is likely to leave its massive monetary stimulus unchanged.

Market players will comb Governor Haruhiko Kuroda's comments for clues about the future pace of BOJ stimulus amid fading expectations for fresh stimulus.

Capital Economics said in a note to clients that "more [BOJ] easing will only be announced in late October [2014]."

Analysts will also be tracking China's industrial output data for the month of May, due out on 13 June, to determine if the world's second-largest economy is regaining momentum. The consensus forecast is for 8.8% output growth year-on-year, up from 8.7% in April.

Elsewhere, 13 June's US producer prices data for the month of May, a substitute for consumer inflation, could reveal whether second-quarter acceleration in the American economy is fuelling inflation.