Morgan Stanley Records $3.4 Billion Dollar Gain

October 21 00:00 2011

New York, Oct 21 ( – In what seems to be like an impeccable quarter for the financial services industry, Morgan Stanley has joined its rivals in projecting accounting gains. Wall Street has suddenly started appraising financial stocks positively. Investors sent Morgan Stanley’s stock rising by 3% as the news of accounting gain was received by the market.

Investors had been earlier concerned about the large  exposure that Morgan Stanley may have, to sovereign European debt, which is falling in value every day. Morgan Stanley came clear on its exposure to such debt as it announced the exact figures, stating its exposure in the clearest way possible.

It’s exposure to the sovereign debt of Portugal, Italy, Spain and Greece was about $5.69 billion and about $2.1 billion including hedges. On the other hand, its exposure to French debt was a mere $286 million as against $39 billion that was pegged earlier by unofficial sources.

Morgan Stanley saw increased profits in its brokerage business which is a joint venture with Citigroup. These results, in a quarter where the financial industry was in turmoil, are evidence of the resilient nature of Morgan Stanley’s business and the thoughtful policies of the management to contain risk.