Morgan Stanley beats Q2 revenue and profit expectations

US banking giant Morgan Stanley's second-quarter revenues and profits exceeded expectations on the Street on Thursday, driven by strength in both equities trading and investment banking.

Morgan Stanley reported revenues of $14.8bn, ahead of estimates of $13.98bn, while earnings per share smashed expectations of $1.65 each at $1.85. Net income was $3.5bn, up from $3.2bn a year ago.

During the second quarter, Morgan Stanley pulled in $2.83bn in revenue from its equities trading franchise, beating analysts' expectations by more than $400.0m to make up for a shortfall in fixed income revenues of $1.68bn that came in below the $2.0bn estimate.

Morgan Stanley also unveiled strong investment banking results, with revenues of $2.38bn coming in well ahead of the $2.1bn expected by analysts.

Chairman and chief executive James Gorman said: "The Firm delivered another very strong quarter, with contributions from all of our businesses. Our wealth and investment management businesses attracted $120.0bn in flows and institutional securities generated over $7.0bn in revenues.

"With our transformed business model providing more stable and durable earnings, we have doubled our dividend and announced a $12.0bn buyback as we move to return our excess capital to shareholders. Our global franchise is very well positioned to drive further growth."

As of 1315 BST, Morgan Stanley shares were down 1.20% in pre-market at $91.35 each.