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Morgan Stanley sees profits up over 100%

Wall Street investment bank Morgan Stanley has announced an increase in profits of over 100 per cent for the second quarter, continuing the trend of sky-high profits for the US's big investment banks this year.

The bank reported a rise in net income reaching $1.96 billion, with revenues from trading deals and its successful investment banking business largely responsible for the boost in profits.

Despite taking into account the favorable market conditions that have seen banks thrive, analysts still underestimated the success that new Morgan Stanley CEO John Mack would bring, with performance soundly beating analysts' estimates.

Commenting on the profits increase, Mr Mack said: "I could not be more pleased… we have seen improvement in all of our businesses and are continuing to make significant progress in executing on our plan to drive improved growth, margins and ROE.

"There is still a great deal of work to be done, but we are moving aggressively on many fronts and we see significant opportunities to create shareholder value."

In response to the profits report, shares in Morgan Stanley promptly rose by the largest amount in over two years, up nearly five per cent on the New York Stock Exchange to $59.79 per share.