Morgan Stanley, releasing its 2nd quarter earnings Wednesday, reported a 60% drop in profit from $2.57 billon, or $2.45 a share, in the second quarter of 2007, to $1.01 billion, or 95 cents a share. Net revenue also fell a substantial 38% from $10.52 billion to $6.51 billion.

Due to difficult conditions that have consumed markets this past year, reductions in client activity and the requirements of severance pay have affected the profits of Morgan Stanley and other investment banks, the Associated Press reports.

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