Three of Wall Street's biggest firms, Goldman Sachs Group Inc., Morgan Stanley and Lehman Bros. Holdings Inc., rode the wave of booming debt markets to report surprising quarterly profit increases Thursday.
Goldman, Morgan Stanley and Lehman, which ended their fiscal first quarters Feb. 28, all beat Wall Street earnings estimates as their fixed-income departments posted banner results.
However, the three firms continue to be dogged by weak stock underwriting and merger advisory activity, which help drive investment banking revenue. The environment for those businesses remains tough, executives said.
Despite the improved results, executives at the firms held out no hopes for increased employment, and Goldman Sachs left open the possibility of additional job cuts as Wall Street trims headcount to align with weak securities markets.
In New York Stock Exchange trading Thursday, Goldman shares fell 19 cents to $70.08, Lehman slid 16 cents to $59.53 and Morgan gained 57 cents to $40.05.