Deal drought spurs Morgan Stanley layoffs: sources

STORY: China’s strict lockdowns have weighed on its economy, and may now be causing pain on Wall Street.

The restrictions have led to a deal drought for bankers in the country.

Merger and acquisition activity in Hong Kong is running at less than a third of last year’s level.

Now Morgan Stanley may be cutting jobs in response.

Reuters sources say layoffs are planned in the Asia Pacific region, with the focus on China.

Global cuts could also be made around the same time.

One source said the moves would account for a low single-digit percentage of staff worldwide.

With deals running dry, other banks are taking action too.

Goldman Sachs cut jobs in September, after pausing the annual practice for two years.

Deutsche Bank also cut staff at its investment banking unit.

Morgan Stanley last month reported a 30% slump in third-quarter profits.

Boss James Gorman hinted then that cost-cutting was on the agenda.

He said the bank was looking at headcount, but didn’t provide any further detail.