Your source file creates "öä" by combining characters.
Look at this:
System.out.println(Arrays.toString("\u00F6\u00E4".getBytes("ISO-8859-1")))
This will print [-10, -28] as you expect (I don’t like to print it this way, but I don’t know that this is not a question of your question) because it shows the Unicode codes carved from the stone and your text editor it is not permitted to “play smart” by combining “o” and “a” with diacritical marks.
Usually, when you encounter such problems, you probably want to use two OS X Un * x commands to understand what happens under the hood: file and hexdump very convenient in such cases.
You want to run them in the source file, and you can run them in your class file.
SyntaxT3rr0r
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