Wall Street trio boost revival hopes

THREE leading New York investment banks confirmed the improvement in financial markets with sharply higher third-quarter results that comfortably beat Wall Street expectations.

Morgan Stanley's net income doubled to $1.27bn (£770m) from $611m last year as its fixed-income securities business remained strong despite the rise in US Treasury bond yields. Equities and advisory business moved ahead after a long period of poor performance.

Lehman Brothers also showed an impressive rise in net income, to $480m from $194m.

Goldman Sachs' results did not beat expectations as strongly as the other two banks. It said net income was $677m compared with $522m last year. Fixed-income revenue made up for continued weakness in its equities business.

A sharp increase in principal investments, trades on its own behalf, offset a 48% drop in fixedincome trading, currencies and commodities.