Wall Street boom sees profits surge at Morgan Stanley

(Sharecast News) - Morgan Stanley posted a sharp increase in quarterly profits on Wednesday, the latest Wall Street bank to benefit from buoyant global markets. Second-quarter revenues came in at $21.3bn, up sharply on last year's $16.8bn, while net income soared to $5.6bn from $3.5bn, comfortably beating estimates for $4.7bn.

Driving the growth was bumper performances in investment banking and equity trading. Investment banking net revenues rose 58% to $2.4bn, slightly ahead of consensus, while equities trading revenues rocketed 69% to $6.3bn.

Wealth management also performed well, however, adding a record $148bn in net new assets. Consensus had been for an increase of just $67bn.

Chief executive Ted Pick said: "Active markets and consistent execution across all the regions drove exceptional results.

"We continue to accrete capital, giving us incremental flexibility to invest in our core businesses while generating strong returns for shareholders."

Wall Street's banks have benefited from a boom in equities, despite the spike in geopolitical tensions following the outbreak of war in the Middle East. That sent global energy prices soaring and reignited inflationary fears, but equity markets have remained buoyed throughout.

There has also been a pick-up in major deals, with Morgan Stanley working on Fertitta Entertainment's $17.6bn acquisition of Caesars Entertainment during the quarter and as a lead underwriter on SpaceX's record $1.77trn initial public offering.

The second-quarter earnings season has already heard from Goldman Sachs, JP Morgan, Citigroup and Bank of America, with all showing sharp rises in revenues and profits.

At 1555 BST, the shares were up 1% at $229.94.