Morgan Stanley misses profit estimates in Q2 as dealmaking stalls

Morgan Stanley missed profit estimates for the first time in nine quarters on Thursday, as its investment banking unit struggled to cope with a slump in global dealmaking.

The U.S. Federal Reserve's aggressive actions to contain runaway inflation has rattled global financial markets, forcing corporates to curb their appetite for deals, while also slowing their efforts to raise cash through stock and debt offerings.

The turmoil has, in turn, upended a lucrative revenue stream for investment banks, whose results are also facing tough year-earlier comparisons when accommodative monetary policies led to record levels of deals.

Revenue from investment banking plunged 55% to $1.1 billion, with the bank's advisory business taking a 10% hit. Equity and fixed income underwriting revenue also plunged 86% and 49%, respectively.

JPMorgan Chase & Co reported a