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Morgan Stanley's profit jumps 45% on trading boom

Morgan Stanley has today posted a 45% rise in its second quarter profits
Morgan Stanley has today posted a 45% rise in its second quarter profits

Morgan Stanley has posted a better-than-expected surge in quarterly profit, driven by strong trading gains as the coronavirus pandemic drove record swings in global financial markets.

The bank's trading unit recorded a 68% jump in revenue, led by a nearly 168% surge in bond trading. Equities trading revenue rose 23%. 

The results mirrored those of rival Goldman Sachs Holdings, which posted its best trading revenue in a decade. 

Investment banking was another bright spot for Morgan Stanley, where revenue jumped 39% as businesses continued to access the market to benefit from the lower rate environment and to raise liquidity. 

Morgan Stanley set aside $239m as provisions for credit losses, down from $407m in the previous quarter. 

The bank's earnings attributable to common shareholders rose to $3.2 billion, or $1.96 per share, in the second quarter ended June 30, from $2.2 billion, or $1.23 per share, a year ago.

Analysts on average had expected a profit of $1.12 per share, according to IBES data from Refinitiv.