UPDATE 2-Algeria's parliament appoints interim president, students protest

Algeria's parliament appointed on Tuesday its upper house chairman Abdelkader Bensalah as interim president following the resignation of ailing Abdelaziz Bouteflika after weeks of mass demonstrations against his rule. His appointment is in keeping with Algeria's constitution but protesters, who want sweeping democratic reforms, oppose figures like Bensalah, a close associate of Bouteflika and his inner circle who dominated Algeria for decades.

Shortly after the announcement in parliament, hundreds of mostly students protested in central Algiers, some chanting "Bensalah go". The big question is how Algeria's powerful military - long seen as a kingmaker in Algerian politics -- will react to Bensalah's appointment and any opposition that arises.

Army Chief of Staff Lieutenant General Gaid Salah carefully managed Bouteflika's exit, which came after six weeks of mostly peaceful demonstrations. Salah has expressed support for protesters, who want democratic reforms after almost 60 years of monolithic rule by veterans of the 1954-62 independence war against France.

Upon stepping down, Bouteflika promised that elections would be held after 90 days as part of a transition he said would usher in a new era. As per the Algerian constitution, Bensalah will remain interim president until new elections are held.

"We must work to allow the Algerian people elect their president as soon as possible," Bensalah told parliament. (Additional reporting by Aziz El Yaakoubi in Dubai Writing by Michael Georgy Editing by Raissa Kasolowsky)

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