US bank Morgan Stanley announced better-than-expected earnings for the first quarter as a result of the continued recovery in financial markets and higher revenue from trading stocks and bonds.
Wall Street giant Morgan Stanley's first-quarter net revenues surged 10 percent year-on-year to $9.9 billion (9.2 billion euros), the bank said on Monday, marking the strongest quarterly growth in many years. Between January and March, net income climbed to $2.3 billion, or $1.18 per share, from $1.4 billion, or 74 cents per share, in the period a year ago.
"This was our strongest quarter in many years with improved performance across most areas of the firm," chief executive James Gorman said.
Revenue from trading in stocks and bonds, among others asset classes, contributed a big slice of the bank's profit. Morgan Stanley said sales and trading of stocks brought in $2.3 billion compared to $1.7 billion the year before. Trading of bonds, currencies and commodities rose to $1.9 billion from $1.7 billion.
Big swings in financial markets helped drive banks' trading profits in the first quarter of this year. When markets become volatile, traders place bets to try to take advantage of swings in the market. As trading volumes rise, banks and brokers earn more in commissions.
Morgan Stanley's stock has gained 19 percent over the past year, outperforming the broader market.
sri / uhe (dpa, AP, Reuters)