Morgan Stanley beats estimates on better-than-expected trading and investment banking

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Morgan Stanley said second-quarter profit and revenue topped analysts' estimates on stronger-than-expected trading and investment banking results.

Here's what the company reported:

The bank said profit surged 41% from the year-earlier period to $3.08 billion, or $1.82 per share, helped by a rebound in Wall Street activity. Revenue rose 12% to $15.02 billion.

Morgan Stanley benefited from its Wall Street-centric business model in the quarter, as a rebound in trading and investment banking helped the bank's institutional securities division earn more revenue than its wealth management division, flipping the usual dynamic.

Equity trading generated an 18% jump in revenue to $3.02 billion, exceeding the StreetAccount estimate by about $330 million. Fixed income trading revenue rose 16% to $1.99 billion, topping the estimate by $130 million.

Investment banking banking revenues surged 51% to $1.62 billion, exceeding the estimate by $220 million, on a surge in fixed income underwriting revenue. Morgan Stanley said that was primarily driven by non-investment grade companies raising debt.

«The firm delivered another strong quarter in an improving capital markets environment,» CEO Ted Pick said in the release. «We continue to execute on our strategy and remain well positioned to deliver growth and long-term value for our shareholders.»

Last week, JPMorgan Chase, Wells Fargo and Citigroup each topped expectations for revenue and profit, a streak continued by Goldman Sachs on Monday, helped by a rebound in Wall Street activity.

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