Morgan Stanley sees profit surge

Morgan Stanley HQ, New York
Image caption Morgan Stanley has set aside $361m to pay a UK bank bonus tax

US bank Morgan Stanley saw a stronger than expected profit in the three months to the end of June, despite weakness elsewhere in the sector.

The Wall Street giant made a net profit of $1.4bn (£917m) compared with a loss of $138m in the same period last year.

Its shares ended the day up 6.3% on Wall Street.

On Tuesday, Goldman Sachs disappointed investors after reporting a sharp fall in profits after being hit by the UK's bonus tax, a US fine and poor trading.

Morgan Stanley said employee compensation for the quarter - which included the bonus pool - was $3.9bn.

But it said it had set aside $361m to cover the cost of a one-off tax on bonuses paid to UK employees.

Meanwhile, another Wall Street stalwart, Wells Fargo, reported its quarterly net profit fell slightly to $3.1bn from $3.2bn a year earlier.

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