CAIRO -- An Egyptian appeals court overturned Hosni Mubarak's life sentence Sunday and ordered a retrial of the ousted leader in the killing of hundreds of protesters, a ruling likely to further unsettle a nation still reeling from political turmoil and to complicate the struggle of his Islamist successor to assert his authority.

The court's decision put the spotlight back on the highly divisive issue of justice for Mubarak and his top security officers, who were also ordered retried, two years after the revolution that toppled him.

The ruling poses a distraction for President Mohammed Morsi as he tries to restore law and order, grapple with a wrecked economy and deal with the aftermath of the worst political crisis since Mubarak's ouster.

A new trial is virtually certain to dominate national headlines, attracting attention away from a crucial election for a new house of deputies roughly three months from now. Morsi and his Islamist allies are determined to win a comfortable majority in the new chamber, allowing them to take the helm of the most populous Arab nation.

The ailing 84-year-old Mubarak is being held in a military hospital and will not walk free after yesterday's decision. He remains under investigation in an unrelated case.

A small crowd of Mubarak loyalists erupted into applause after the ruling was announced. Holding portraits of the former president aloft, they broke into chants of "Long live justice!" Later, another jubilant crowd gathered outside the Nile-side Cairo hospital where Mubarak is being held, passing out candies to pedestrians and motorists.

Still, the crowds paled in comparison with the immediate reaction to Mubarak's conviction and sentencing in June, when thousands took to the streets, some in celebration and others in anger that he escaped the death penalty.

The muted reaction indicates the fate of Egypt's ruler of nearly three decades may have, at least for now, been reduced to a political footnote. No date was set for the retrial.

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