NEW YORK (AP) — Investment bank Morgan Stanley's third-quarter earnings almost doubled as the firm's stock sales and trading revenue rose.
THE RESULTS: The bank earned $1.01 billion from July to September after stripping out an accounting charge. That compares with earnings of $560 million a year earlier. That profit works out to 50 cents per share before the charge, compared with 28 cents per share in the same period a year earlier. Financial analysts polled by FactSet expected earnings of 40 cents. Analysts generally strip out one-time items.
Total revenue amounted to $8.1 billion, up 6.5 percent from $7.6 billion a year earlier.
HOW IT HAPPENED: Stock sales and trading were bright spots for the bank and revenue in that part of its business increased to $1.7 billion from $1.3 billion. Investment revenue also rose after the bank sold an investment in an insurance broker. Profit at the bank's wealth management unit also rose.
Morgan Stanley is transforming itself to adapt to a post-financial crisis world, trimming back parts of its investment bank while increasing its focus on individual clients.
"Our results point to the increased consistency, strength and balance we are deriving from our business model," CEO James Gorman said in a prepared statement. "Overall, our stronger year-over-year revenues and net income reflect the progress we have made."
THE WEAK SPOT: Like other banks that reported earnings this week, fixed income trading plunged. Morgan Stanley said that its fixed income and commodities trading revenues fell to $835 million from $1.5 billion from a year earlier. Goldman Sachs and Citigroup also saw their trading revenue in this area drop. The slump was caused by jittery investors who were uncertain about whether and when the Federal Reserve would begin to reduce its bond purchases of $85 billion a month, said Goldman.
THE MARKET REACTION: Morgan Stanley's stock rose 52 cents, or nearly 2 percent, to $29.45 by late morning. Its shares have risen 54 percent this year, far more than any other major U.S. bank.
Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Three Albuquerque veterans remember vividly the sneak attack on Pearl Harbor that brought the U.S. into World War II 72 years ago Saturday.
After getting out of federal prison early this week it looks like former state Sen. Manny Aragón isn't at a halfway house after all. He's back at his own house in the South Valley.
The owner and an employee of a local smoke shop are in federal custody accused of selling spice at the Rio Rancho store.
The New Mexico State Police officer who fired his weapon at van filled with kids during a traffic stop gone bad has been fired.
The civil case filed against former cop Levi Chavez in the gunshot death of his wife is coming to an end without a trial.
Could there be a serial dog snatcher in Roswell?