I saw there are numerous questions and answers for typesetting Arabic characters. Yet I can't get them work. I tried to replicate this answer, which is exactly what I want to obtain - few in line Arabic characters. I haven't changed the MWE of the mentioned answer:
\documentclass[a4paper,10pt]{article}
%In the preamble section include the arabtex and utf8 packages
\usepackage{arabtex}
\usepackage{utf8}
\begin{document}
%start encoding to unicode
%Note that your layout must support arabic text when compiling
\setcode{utf8}
%To start typing in Arabic use the command arabtext
hello
\<السَلامُ عَليكم ورَحمةُ الله وبَركاته >
arabic
\end{document}
Yet LaTeX, without throwing any error, typeset this:

I tried to open the PDF with Skim, Adobe Pro and Mac Preview with the same result.
I am using TeX 3.14159265 (TeX Live 2014) kpathsea version 6.2.0 of the MacTeX-2014 Distribution and Aquamacs as text editor.
My best guess is that I have some encoding problem somewhere in the pipeline. My .tex file is encoded in utf-16 and in the text editor rightly shows the characters:
