Jefferies posts loss as equities trading revenue slumps

(Reuters) - Investment bank Jefferies Group LLC posted a loss in the first quarter as revenue from equities and fixed income trading was hammered by the recent turmoil in global financial markets.

The New York bank said revenue from equities trading slumped to $1.75 million from $203.5 million a year earlier. Fixed income revenue more than halved to $56.8 million.

Revenue from sales and trading, which contributed to more than half of its net revenue in the year-ago quarter, accounted for just 20 percent in the first quarter.

“Almost every asset class, including equities and fixed income, suffered significantly amid concerns about the pace of global economic growth, outflows from the high yield market, forced selling from hedge funds, uncertainty over China, a potential Brexit, and an overall void in liquidity,” Chief Executive Rich Handler said.

Net loss attributable to Jefferies was $166.8 million in the first quarter ended Feb. 29, compared with a profit of $12.6 million in the year-ago period.

Jefferies, a unit of Leucadia National Corp LUK.N, kicks off the reporting season for investment banks and is often viewed as an indicator of the performance of Wall Street banks.

Reuters reported last week that Jefferies would merge its junk-rated loans and bonds business with the junk debt unit of its joint venture with MassMutual Financial Group.

Reporting by Sruthi Shankar in Bengaluru; Editing by Saumyadeb Chakrabarty