10:44 AM EDT, 04/11/2025 (MT Newswires) -- Morgan Stanley's ( MS ) first-quarter results topped market expectations as equity trading revenue jumped, while the investment bank said the US economy is unlikely to slip into a recession.

Morgan Stanley ( MS ) on Friday reported per-share earnings of $2.60 for the March quarter, up from $2.02 the year before and surpassing the FactSet-polled GAAP consensus of $2.18. Revenue climbed 17% to $17.74 billion, ahead of the Street's view for $16.54 billion.

In the bank's institutional securities business, revenue advanced to $8.98 billion from $7.02 billion in the prior-year quarter, driven by a 45% rally in equity trading to a record $4.13 billion. Investment banking revenue rose 8% to $1.56 billion amid higher advisory revenue tied to completed merger and acquisition transactions. Equity underwriting, however, decreased due to market uncertainty, according to the company.

"The stock, bond and currency markets are exhibiting the kind of overnight and intraday volatility that reflect rapidly changing probability assessments of different policy outcomes," Chief Executive Ted Pick said during an earnings call, according to a FactSet transcript. "Economists are telling us the risk of recession has materially increased, but the consensus today is softer, not negative, growth."

China on Friday reportedly raised its tariffs on US imports to 125%, in response to US President Donald Trump's move to hike duties on Beijing to 145%. Earlier in the week, Trump announced a 90-day pause for certain tariffs for non-retaliating countries.

"The simple truth today is that we do not yet know where trade policy will settle, nor do we know what the actual transmission effects will be on the real economy," Pick told analysts. "Given this unpredictability, some clients are deferring strategic activity while others are proceeding."

The wealth management business recorded revenue of $7.33 billion, rising from $6.88 billion a year ago, reflecting higher asset levels and transactional revenue. Within the division, net interest income improved to $1.9 billion from $1.86 billion.

Investment management revenue advanced 16% to $1.6 billion. Client assets of $7.7 trillion across wealth and investment management were "supported by $94 billion in net new assets," Pick said in a statement. Within investment management, assets under management reached $1.647 trillion versus $1.505 trillion at the end of the 2024 first quarter.

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