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Morgan Stanley Lays Off 5 People From London Equity Business

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Morgan Stanley (MS - Free Report) has supposedly fired five people from its equities sales and trading business in London. The news was first reported by Bloomberg, citing people with knowledge of the matter.

These cuts come after the company reported weak trading revenues in the first quarter. Its equity trading income fell 21%, which along with a 9% fall in fixed-income trading income led to the decline in trading revenues.

Moreover, underwriting revenues (both equity and fixed income) declined 22%, which was a negative for the company.

Per people familiar with the matter, Simon Mardel, Matthew Bubba, Tom Cooper, Robert Bloomer and Neil Taub are the ones who lost their jobs.

Simon Mardel joined Morgan Stanley in 2014 while Neil Taub arrived in 2010. Matthew Bubba started his career as an equity sales trader in 2008 and since then he has been part of the company. Similarly, Robert Bloomer has been in the company since pre-2001.

Notably, trading income, which is largely dependent on the overall performance of the capital markets, constitutes almost 35% of Morgan Stanley’s net revenues. While trading revenues declined in first-quarter 2019, solid client activity and rise in market volatility supported trading revenues in 2018.

Given the expectations of global economic slowdown and geopolitical tensions, markets are expected to remain volatile in the quarters ahead.

We believe that the company’s focus on the corporate lending unit along with steady loan growth, higher interest rates and normalized levels of trading activities will likely aid revenues, going forward.

Shares of Morgan Stanley have gained 3.1% over the past six months against 2.1% decline of the industry it belongs to.

Currently, the company carries a Zacks Rank #3 (Hold).

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