Jefferies Group Inc. (JEF:US) fell as much as 3.6 percent in New York trading after Susquehanna Financial Group LLLP lowered its profit estimates for the investment bank. Morgan Stanley (MS:US) and Goldman Sachs Group Inc. (GS:US) also declined.
Jefferies dropped 40 cents to $13.31 at 11:21 a.m. in New York, the most in two weeks. Doug Sipkin, an analyst at Susquehanna, cut his second-quarter earnings estimate for New York-based Jefferies to 31 cents a share from 34 cents, citing weaker trading in the three months ended May 31, according to a note to clients today. Morgan Stanley fell 3 percent and Goldman Sachs Group Inc. slid 2.6 percent.
Fixed-income trading revenue at Jefferies doubled in the fiscal first quarter from the previous period, led by the credit businesses, Chief Executive Officer Richard Handler said in March. Equity trading picked up in February, when the fiscal first quarter ended, he said.
“The revision is reflective of weaker trading, and modest spread widening partially offset by strong high yield, leverage loan, and improved equity banking,” Sipkin said in the note. “We do expect to see modest improvement in equity trading from last quarter.”
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