Morgan Stanley (MS) Results Poor, But Investors Relieved

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Morgan Stanley (MS) followed other Wall St. firms with poor results and the company said the future was doubtul.

But, the numbers were good enough to keep the horses in the barn.

The company said income from continuing operations for the first quarter ended February 29, 2008 were $1,551 million, or $1.45 per diluted share, compared with $2,314 million, or $2.17 per diluted share, in the first quarter of last year. Net revenues were $8.3 billion, 17 percent below last years first quarter.

Fixed income sales and trading revenues were $2.9 billion, the second highest quarter ever. These results reflect record revenues in interest rate, credit & currency products and the second highest quarter ever for commodities, partly offset by mortgage proprietary trading net writedowns of approximately $1.2 billion.

Asset Management faced challenging market conditions with losses in real estate and incurred further losses related to securities issued by structured investment vehicles resulting in a pre-tax loss of $161 million.

Shares are up almost 5% in the pre-market.

Douglas A. McIntyre