Nomura has lifted its view on the UK retail sector from 'neutral' to 'bullish', even though the category has outperformed the wider market so far this year.Nomura has raised its recommendation for electrical retailer Dixons from 'neutral' to 'buy', lifting its target price from 31p to 60p, saying the company has addressed the challenges of online price transparency and relative costs and will continue to benefit from capacity exit. Home Retail, while still regarded as a "work in progress" given the turnaround at its Argos chain, has also been upgraded from 'neutral' to 'buy' (target price raised from 155p to 200p). Meanwhile, DIY retailer Kingfisher has been raised from 'reduce' to 'neutral' (target price up from 280p to 380p), given its exposure to a potential housing recovery.Panmure Gordon has upgraded its rating for engineering support services group Babcock from 'hold' to 'buy' and hiked its target price from 1,050p to 1,350p.In a research report titled 'Sitting pretty', Panmure said: "With a number of positives facing the group against a relatively flat share price performance vs. some of its peers, we believe Babcock is very well positioned at present."Investec has maintained its 'buy' rating and 3,303p target price for diversified mining group Rio Tinto after the firm's upbeat second-quarter operational update on Tuesday.Analyst Hunter Hillcoat said that the most important division, iron ore, delivered production ahead of Investec's forecasts: 66m tonnes were mined in the second quarter, up 7.0% on the first quarter and ahead of the 62.2m forecast. "All other key divisions were in line with or better than our expectations," he said.BC