Morgan Stanley tops estimates

Morgan Stanley reported earnings that beat analysts’ estimates as equity-trading revenue jumped the most among the biggest Wall Street firms and the wealth-management profit margin climbed.

Bloomberg News reports that third-quarter net income was $906m, compared with a loss of $1.02bn a year earlier, the New York-based company said Friday in a statement.

Excluding an accounting charge tied to the firm’s own debt, profit was 50 cents a share, topping the 40-cent average estimate of 24 analysts surveyed by Bloomberg.

CEO James Gorman has made Morgan Stanley more reliant on wealth-management revenue while decreasing the amount of capital allocated to fixed-income trading, which last quarter generated the least revenue among the firm’s peers. Stock trading and Morgan Stanley’s retail brokerage, the world’s biggest, both benefited from an 18% rise in the Standard & Poor’s 500 Index in the first nine months of 2013.

'Equity capital markets was really strong and equity trading was strong, and I think that’s a really good positive for Morgan Stanley', David Konrad, head of U.S. bank research at Macquarie Group Ltd., said in a Bloomberg Radio interview before results were announced. 'They are very focused on the equity business'.

Hit the link below to access the complete Bloomberg article:

Morgan Stanley Tops Estimates on Stock Trading, Brokerage

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