Jefferies Second-Quarter Net Drops 34%

Jefferies Second-Quarter Net Drops 34%

Jefferies Group, the investment bank acquired by Leucadia National LUK -0.94% earlier this year, said its fiscal second-quarter profit fell 34% as fixed-income-trading revenue slumped amid concerns that the Federal Reserve would taper its economic stimulus program.

Jefferies and Leucadia Chief Executive Richard Handler in a statement called the trading environment “tepid and cautious,” which could bode poorly for larger rivals including Goldman Sachs Group Inc. (GS) and Morgan Stanley MS +0.42% (MS) that report earnings next month.

Jefferies, which closed the Leucadia transaction on March 1, is the first U.S. investment bank to report second-quarter results and is often seen as something of a barometer for the bigger banks, though its fiscal period ends a month earlier than those firms.

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