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Morgan Stanley's profit rises on dealmaking, trading boost
Investment banking revenue climbed 36% to $2.12 billion, while trading revenue rose in both equities and fixed income, Morgan Stanley said.
Morgan Stanley reported first-quarter profit of $5.6 billion on Wednesday, up from $4.3 billion a year earlier, driven by strong dealmaking and surging trading revenue that lifted total quarterly revenue to $20.6 billion.
Escalating US-Israeli conflict with Iran drove market volatility in recent weeks, prompting investors to rebalance portfolios and increase hedging against potential losses—a trend that typically boosts activity at trading desks.
Investment banking revenue climbed 36% to $2.12 billion, equity trading revenue rose 25% to $5.15 billion, and fixed-income revenue jumped 29% to $3.36 billion, driving the firm's overall performance gains.
Peers Goldman Sachs, JPMorgan, and Citigroup also reported surges in investment banking revenue, while Morgan Stanley advised on the $65 billion Unilever-McCormick merger and served as a bookrunner on SpaceX's IPO.
Following a 2025 where global M&A surpassed $4.81 trillion, investment banks expect deal momentum to continue this year as a friendlier regulatory environment could prompt cash-rich companies to pursue takeovers despite economic threats.