Morgan Stanley saw an increase in its first-quarter profit due to successful trading amid market volatility that stimulated client participation. The bank announced earnings of $4.3 billion, or $2.60 per share, for the quarter ending on March 31, up from $3.4 billion, or $2.02 per share, from the previous year. Factors such as President Donald Trump's tariff implementation and the debut of China's DeepSeek AI model caused global market turbulence. Concerns about a possible recession and uncertainty regarding the Federal Reserve's interest rate direction have left investors cautious. Morgan Stanley's revenue rose to $17.7 billion in Q1, an increase from $15.1 billion a year ago, leading to a 1.9% rise in its pre-market share value. The bank's equity trading revenue surged as investors adjusted their portfolios, particularly in the technology and industrial sectors. Enhanced fixed-income trading revenue was seen due to escalating worries about stagflation caused by Trump's tariffs. The investment banking industry faces challenges driven by the ongoing trade tensions, impacting dealmaking and market stability. While M&A activity increased in Asia, it declined in the U.S. amidst growing uncertainties, impacting Morgan Stanley's revenue sources. The lengthy trade conflict, lackluster IPO performances, and sluggish progress on major deals may discourage investors and advisory activities in the upcoming quarters. Optimal market conditions support deal-making by boosting confidence among buyers and sellers regarding valuations and decreasing risks, thus encouraging transactions. Morgan Stanley secured a global fourth position in investment banking fees in Q1, advising on significant deals such as Walgreens' $24 billion privatization transaction with Sycamore Partners. The bank also played a pivotal role in AI cloud firm CoreWeave's $1.5 billion IPO in the U.S. Investment banking revenue for Morgan Stanley rose by 8% in the first quarter, with its Institutional Securities division reporting revenue of $9 billion compared to $7 billion the previous year.