A surge in fixed income revenue lifted Morgan Stanley's quarterly results. Fred Katayama reports.
A banner earnings season so far for most of the big U.S. banks. Morgan Stanley's quarterly profit doubling, lifted by bond trading revenue that nearly tripled. Trading in bonds and stocks have surged since Donald Trump's surprise election victory in November. Morgan Stanley's fixed income trading results far exceeded the healthy gains posted by JPMorgan Chase and Bank of America last week. Oppenheimer analyst Chris Kotowski called it a "solid quarter," saying, "We think stronger fixed income, currencies and commodities trading should not necessarily be seen as a fluke. .. FICC trading should be a beneficiary of higher rates, as higher rates will require more bond portfolio repositioning." Revenue also rose in the company's investment banking and wealth management businesses. Morgan Stanley's shares rose in early trading, adding on to their nearly 29 percent gain since the election. Its archrival, Goldman Sachs, and Citigroup report their results on Wednesday.