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URGENT: Video shows beheading of second American journalist

DUBAI (Reuters) - The Islamic State militant group released a video purporting to show the beheading of U.S. hostage Steven Sotloff, the SITE monitoring service reported on Tuesday. A masked figure in the video also issued a threat against a British hostage, a man the group named as David Haines, and warned governments to back off "this evil alliance of America against the Islamic State", the monitoring service said. (Reporting by William Maclean, Editing by Angus MacSwan)

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Engine problem makes a mockery of Maldonado penalty

SHANGHAI (Reuters) - Pastor Maldonado's five place grid penalty was rendered meaningless on Saturday after engine problems ruled the Lotus Formula One driver out of Chinese Grand Prix qualifying.

While Romain Grosjean powered to the team's first top 10 grid position of the season, Maldonado never got out of the garage.

The penalty, imposed for running into the back of Esteban Gutierrez's Sauber at the previous race in Bahrain, will be deemed to have been served even though the former Williams driver lines up last anyway on Sunday.

Maldonado's problems developed a little over halfway into Saturday morning's final practice when his car's Renault power unit developed a leak.

That required a change of engine, now a lengthy procedure with the new V6 turbos and their hybrid energy recovery systems and one that could not be done in time for the start of qualifying.

"I remain optimistic and I'll do my best as always but it's not a very good situation to be dealing with, but we are working very hard to keep improving," said Maldonado, who had been sixth fastest in the practice session.

Lotus have had a difficult start to their season with chronic unreliability holding back the Enstone-based squad, who have yet to score a point in 2014 after winning the season-opening race last year and finishing fourth overall.

Their best result this season has been an eleventh place finish for Grosjean in Malaysia.

"We have made good progress this weekend," said Grosjean, who qualified 10th. "We are hoping for a good race for tomorrow and hopefully we can stay in the top 10."

(Reporting by Abhishek Takle, editing by Alan Baldwin)