NEW YORK (AP) — Morgan Stanley said Thursday that its quarterly profit more than doubled, thanks to strong performances from its investment banking and money-management units.
Second-quarter net income jumped to $1.88 billion from $900 million a year earlier, after excluding an accounting gain.
Adjusted for that gain and a big tax benefit, Morgan Stanley's quarterly earnings worked out to 60 cents per share, beating the average prediction of 55 cents from analysts polled by FactSet.
Wall Street's banks were expected to turn in weak results this earnings season. Markets have turned relatively calm this year and trading activity has dried up, creating a tough environment for traders to make money.
Much as predicted, Morgan Stanley said revenue from trading stocks, bonds and commodities sank 13 percent in the second quarter. But like Goldman Sachs and other big banks that reported results this week, the bank offset that drop with stronger results from helping companies raise money and arranging initial public offerings, known as IPOs. Investment banking revenue in the quarter increased 25 percent over the previous year.
That increase, along with a 9 percent rise in revenue from asset management, helped the bank overcome its weaker trading performance. The amount of money managed for wealthy people and other clients topped $2 trillion.
Total revenue for the second quarter increased 2.2 percent to $8.52 billion, slightly higher than the $8.22 billion analysts had expected, according to FactSet.
Morgan Stanley's stock rose in early trading but the gains didn't hold as the overall market turned lower. As of midday the stock was down 10 cents, or 0.3 percent, to $32.40.
The bank has lagged behind the broader market, gaining just 3.3 percent this year. The Standard & Poor's 500 index, the most widely used stock-market benchmark, has climbed 6.6 percent.