Equities Revenue Soars 70% in Q3
Morgan Stanley reported a 70% jump in equities revenue for the third quarter of 2024, reaching $3.4 billion, compared to $2.0 billion in the same period last year. The surge was driven by active markets and increased client activity, particularly in derivatives and cash equities, the bank said in its earnings release on Wednesday.
Strong Performance Across Divisions
The equities division's performance outpaced other Wall Street banks, with Goldman Sachs and JPMorgan also reporting gains but at lower rates. Morgan Stanley's overall investment banking revenue rose 20% to $1.9 billion, while wealth management revenue increased 5% to $6.8 billion.
"Our equities business had an exceptional quarter, benefiting from heightened volatility and strong client engagement," said Chief Financial Officer Sharon Yeshaya in a call with analysts. The bank's total net revenue for Q3 was $15.3 billion, up 16% year-over-year.
Impact on Profit and Outlook
Net income attributable to common shareholders rose 32% to $3.5 billion, or $2.08 per share, beating analyst estimates of $1.98 per share. The bank's return on tangible common equity (ROTCE) was 17.5%, up from 14.0% a year ago.
Looking ahead, Morgan Stanley expects continued strength in equities trading, though the bank cautioned that market conditions could shift. "We remain optimistic about our pipeline, but we are mindful of geopolitical risks and interest rate changes," Yeshaya added.
