Market report: Square Mile stocks up on Morrisons after upgrade

The City put Morrisons in the shopping basket earlier as the supermarket group received a thumbs-up from Merrills.

The retailer was upgraded to Buy from Underperform by Bank of America Merrill Lynch, making it one of the biggest risers on the FTSE 100.

Shares rose 1.8% to 241.5p as analysts become more confident in the balance sheet of the business, run by David Potts.

The overall blue-chip index added 7.83 points to 7378.55 as traders continued to shrug off the political noise around the triggering of Article 50 yesterday.

Instead they were raising eyebrows at lower-than-expected inflation data from Spain, helping the pound as it dampened speculation that the European Central Bank will put the brakes on its money-printing programme.

Fridges retailer AO World initially received the cold shoulder before shares recovered. The firm revealed a £50 million share placing, which boss Steve Caunce said would be used to fund expansion.

The online domestic appliances giant, floated in 2014, said annual turnover is expected to be around £700 million, up 17% year-on-year. It tightened its profit guidance — earnings are now expected to be flat.

ETX Capital senior market analyst Neil Wilson said: “Another Ocado? Like the grocery pick-and-pack specialist, AO World is growing sales impressively but finding it hard to turn a profit. Despite the stock dropping 60% since floating in 2014 its shares are trading at multiples that look stretched.” Its stock rose 2.6% to 141.5p.

Mid-cap counterpart Petra Diamonds, saw shares rise 8.8p to 132.6p. The miner announced a restructuring of its debt facilities to give it more breathing space. The FTSE 250 rose 32.81 points to 19,011.46.

On AIM, shareholders cheered Accesso Technology Group, which unveiled a deal to pick up online event ticketing firm Ingresso Group.

It is paying £17.5 million as an initial cash consideration for the firm which counts Amazon Tickets — currently selling tickets for rock band The Darkness — among its client base.

Shares in Accesso jumped 47.5p to 1622.5p.