Tuesday, September 20, 2011

Wall Street Facing ‘Brutal' Fixed-Income After Jefferies Hit

Bloomberg reports that Jefferies Group Inc. posted a 79 percent plunge in fixed-income trading revenue that may show the extent of the damage August's market turmoil caused for its bigger Wall Street competitors.

Revenue from trading bonds for the three months through Aug. 31 dropped to $33.1 million from $161 million a year earlier at New York-based Jefferies, which is led by Chief Executive Officer Richard “Rich” Handler. Profit excluding an acquisition was 10 cents a share, the investment firm said today in a statement, half analysts' estimates in a Bloomberg survey.

The biggest Wall Street firms will start reporting third- quarter results next month showing how they weathered a market grappling with fallout from Standard & Poor's downgrade of the U.S. credit rating and concern Greece would default. August was “outright brutal,” Handler told analysts on a conference call. JPMorgan Chase & Co. and Morgan Stanley both warned investors this month that trading revenue may suffer.

Find out more at http://news.businessweek.com/article.asp?documentKey=1376-LRTYKH1A74E901-41DFQO3SCL0C5BF44D1HA5VOO1

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