By Tatiana Bautzer and Mehnaz Yasmin
(Reuters) -Morgan Stanley's profit slipped 14% in the second quarter from a year earlier as a dealmaking slump continued, while trading in stocks and bonds slumped.
Revenue from investment banking fell to $1.16 billion. Trading revenues slid as volatility declined. Fixed income revenue sank 31% while equities fell 14%.
CEO James Gorman cited a "challenging market environment," in the quarter, which "started with macroeconomic uncertainties and subdued client activity, but ended with a more constructive tone."
The bank's wealth management unit reported record net revenue of $6.7 billion. Morgan Stanley has set a target to increase assets under management to $10 trillion, it said in May, adding it was open to acquisitions.
Revenue from asset management slipped 2%.
Excluding items, Morgan Stanley earned $1.24 a share on a revenue of $13.46 billion, comfortable beating estimates of $1.15 a share on $13.08 billion revenue, according to data from Refinitiv IBES.
The bank also set aside more provisions to prepare for souring loans, mainly because of weakening credit in the commercial real estate sector.
Shares of the investment bank fell 0.2% in premarket trading.
Profit applicable to common shareholders fell to $2.05 billion, or $1.24 per diluted share, the bank said on Tuesday. That is down from $2.39 billion, or $1.39 per diluted share, a year earlier.
(Reporting by Tatiana Bautzer in New York and Mehnaz Yasmin and Niket Nishant in Bengaluru; Editing by Lananh Nguyen, Arun Koyyur and Louise Heavens)
