June 26 (Reuters) - Jefferies Financial's ( JEF )

second-quarter profit jumped nearly twelve-fold as it earned

higher fees from advising on deals as well as underwriting stock

and bond sales, the bank said on Wednesday.

Its earnings, viewed as an early indicator of results at

major investment banks such as Goldman Sachs ( GS ) and Morgan

Stanley ( MS ), underscore the strong recovery in the corporate

dealmaking space.

Expectations of a soft landing for the U.S. economy have

sparked a surge in large mergers and acquisitions (M&A) this

year. Buyers are also selling bonds to fund their purchases,

while a strong rally in equities has boosted investors' appetite

for new offerings.

Jefferies' investment banking revenue in the second quarter

ended May 31 soared 59% from a year earlier to $803.2 million,

helped by a strong performance in its advisory as well as equity

and debt underwriting businesses.

"Overall, momentum continues to build across our Investment

Banking business, as the market opportunity improves and the

investment we have made in our platform translates to increased

market share," Jefferies said in a statement.

The bank's capital markets revenue jumped 24%, thanks to

strength in equities, and helped Jefferies' total revenue climb

60% to $1.66 billion.

In the reported quarter, the company expanded its

partnership with Japan's Sumitomo Mitsui Banking Corp (SMBC) as

it looks to tap into the dealmaking market in Canada, which

offers a competitive advantage for U.S. investment banks.

Jefferies net profit attributable to common shareholders

rose to $145.7 million, or 64 cents per share, from $12.4

million, or 5 cents per share, a year earlier.

So far this year, Jefferies shares have gained nearly 14%,

while those of Goldman Sachs ( GS ) and Morgan Stanley ( MS )

jumped 19% and 5%, respectively.

(Reporting by Lananh Nguyen in New York and Pritam Biswas in

Bengaluru; Editing by Shinjini Ganguli)