Goldman Sachs Group Inc., Morgan Stanley & Co. and other investment banks said Friday they expect to post a record fourth-quarter profit, pushing their stock prices higher amid a global economic slowdown.
Goldman Sachs Group, Morgan and other banks posted an adjusted net profit of $4.4 billion, or $2.84 per share, in the fourth quarter, after earning $3.8 billion, $1.91 per share and $1 per share in the previous three months.
The firm’s $4 billion profit is the highest since it posted a profit of roughly $3 billion in 2010.
Morgan Stanley said its third-quarter adjusted net loss of $1 billion was up from a $9.5 billion loss the previous quarter.
Morgan and Goldman have been among the biggest investors in the world’s biggest financial institutions.
The banks’ stock prices have rallied since the global financial crisis.
Morgan Stanley and Morgan Stanley Capital Markets Inc. said in a joint statement that the third-year profit will likely help to drive Wall Street’s momentum for the fourth- quarter.
Morgan and Goldman are among the top three U.S. investment banks by market capitalization and their combined $14.4 trillion in assets is the biggest.
The three also hold the third and fourth most marketable securities among the U.K.’s three biggest banks.
The three banks are among a group of investment banks that have been boosting dividends and reducing share-based compensation.
Investors have been more forgiving of Goldman’s financial troubles, giving it a boost, according to the firms.
The firms are also making a bid for an IPO in the U, where they have been struggling for a while.
They have raised $12 billion so far, and Goldman is up 8.7 percent.
Morgan has been working on a new business model that involves paying a small amount of cash upfront for shares.
The firm is also trying to scale up to make money from its existing businesses and is in talks with other investment firms about pursuing a spinoff, the firms said.
The Goldman Sachs group’s results are part of the broader results for Wall Street that are being announced later this week by the companies, which include the Morgan Stanley group, the Bank of America Corp. and the Credit Suisse Group AG.
The Dow Jones Industrial Average fell 0.6 percent, the S&P 500 dropped 1.1 percent, and the Nasdaq composite index dropped 2.4 percent.