No Goldman Reaction for Morgan Stanley (GS, MS)

Print Email

Yesterday was a rather odd day in more than one way.  The reaction to Goldman Sachs Group (NYSE: GS) was given a warm reception, despite the much wider losses than expected, the negative revenues after items, and the mark-downs.  This morning, Morgan Stanley (NYSE: MS)  came out with much of the same sort of news with wider losses, etc…  Yet there is no mercy, no applause, and not even a Swiss-themed neutrality nor indifference.

Morgan Stanley is getting the cold shoulder from Wall Street thismorning.  The broker-turned-banker posted a loss of $2.37 billion forthe quarter.  The loss is -$2.34 EPS rather than the expected FirstCall loss estimate of -$0.34.  Yep, a $2-handle loss rather than aslight $0-handle loss.

The broker took writedowns and losses.  Fixed income lost $1.2 billion,yet this is much lower than last year because it now has lower mortgageexposure. It took another $1.1 billion in charges from trading andother sales losses and $1.8 billion in real estate fund losses.

Amazingly enough, the firm was able to post a profit for the full yearjust like  its cousin Goldman Sachs did yesterday.  Morgan Stanleyshares are down 4% at $15.45  in pre-market trading.

Jon C. Ogg
December 17, 2008