Powerful blast kills 14 people and injures 20 in cafe in Moroccan city of Marrakesh

A powerful blast killed 14 people and injured 20, including several tourists, in a cafe in the Moroccan city of Marrakesh on Thursday, authorities said, describing it as a "criminal act".

An interior ministry official confirmed the report and said an investigation was under way to shed more light on the blast which occurred on Jamaa El Fna Square, a favorite spot for foreign visitors, in central Marrakesh.

Earlier reports spoke of the accidental explosion of several gas canisters in the Argana cafe in the middle of the square.

Two people in Marrakesh told Reuters the explosion was the work of a suicide bomber, but there was no immediate confirmation of this. "I heard a massive blast. The first and second floors of the building were destroyed," said one local woman, who did not want to be identified. "Some witnesses said they have seen a man carrying a bag entering the cafe before the blast occurred."

Morocco's main stock exchange, the Casablanca bourse, was down 3.3 percent by 13.33 GMT. "People are panicking. This is a terrorist act and it will affect the economy and tarnish the country's image. Local investors are selling," said a trader on the bourse.

The blast is likely to hurt Morocco's tourism trade - a major source of revenue - which is already struggling to recover from the effects of the global downturn. "Marrakesh is the main tourist destination in Morocco and Argana Cafe has been one of the most popular cafes in the square," said a Frenchman who owns a restaurant in the city. "You can't find a more emblematic target than Jamaa el-Fna square ... With this attack and amid the worrying unrest in the region, tourism will hit the doldrums for some time," said the businessman, who did not want his name published.