The editor of the Mirror newspaper faces an inquiry into whether he broke industry rules by buying shares the day before his paper tipped them to rise.

The Press Complaints Commission is to investigate whether Piers Morgan broke its code of practice after buying about �20,000 of shares in Viglen Technology.

Reports - including a front page story in The Mirror's tabloid rival the Sun - said Mr Morgan bought the shares the day before his newspaper published an exclusive story saying the company was launching a separate internet division.

Mr Morgan has denied any wrong-doing, and says he bought the shares without knowing that his paper would run the story.

Shares in Viglen, Sir Alan Sugar's computer hardware company, jumped from 181p to 366p the following day after Sir Alan confirmed the story. The shares were trading at 231p on Wednesday.

PCC chairman Lord Wakeham said: "We have received a complaint about reports this morning relating to the editor of the Mirror.

"We will be dealing with this complaint in the normal manner under the Code of Practice, unless any other form of investigation prevents us from doing so."

Financial rules

Lord Wakeham's statement set out the code's provisions on financial journalism.

Under the code journalists must not use financial information they receive in advance of its general publication for their own profit - even when the law does not prohibit it.

Journalists must not write about shares or securities in whose performance they know that they or their close families have a significant financial interest, without disclosing the interest to their editor or financial editor.

And they must not buy or sell shares or securities about which they have written recently or about which they intend to write in the future.

Morgan denial

Piers Morgan said that he had not breached Stock Exchange regulations, nor bought shares with prior knowledge.

In a statement he said: "I am happy to cooperate in any Press Complaints Commission investigation, or indeed any other investigation regarding the shares I purchased in Viglen Technology.

"I have not breached the Code of Conduct, nor any Stock Exchange regulations.

"For the record, I did not buy the shares with any prior knowledge that the Mirror's City Slickers column was going to publish a story about Viglen the next day I have never, and would never, buy shares in those circumstances."

"I still retain the stock, which I always intended to be a long term investment."

Mr Morgan added that Viglen had been the subject of numerous positive articles in other media in recent months and the City Slickers column had regularly recommended the company to readers since June 1999.