Goldman profit down but stock up By Joseph A. Giannone NEW YORK (Reuters) - U.S. investment bank Goldman Sachs Group Inc. (GS.N: Quote , Profile , Research ) on Thursday said its second-quarter earnings fell 27 percent, short of expectations, as volatile markets drove away investors and sapped trading profit. It was Goldman's first year-to-year drop in quarterly results in three years, but shares in the Wall Street firm rose as it expressed confidence trading and investment banking activity would rebound on continued economic growth. "We remain optimistic the market will catch up to this economic activity," Chief Financial Officer David Viniar said in a news briefing. Net income in the quarter that Wall Street firms said was marked by tough conditions fell to $865 million, or $1.71 a share, in the quarter ended May 31, from $1.19 billion, or $2.31 a share, a year earlier. Analysts on average expected $1.90 a share, according to Reuters Estimates, and it was the first time Goldman missed expectations in six years as a publicly traded company. Comparison to the first quarter was worse, with earnings 43 percent down on a period fueled by record trading results. Second-quarter net revenue fell 13 percent from a year earlier to $4.81 billion, also lagging expectations. Goldman noted this was its fourth-highest quarterly revenue ever. "Obviously a tough quarter, as many expected," Glenn Schorr, securities industry analyst for UBS, said in a note. Goldman's results came after smaller rivals Lehman Brothers Holdings Inc. (LEH.N: Quote , Profile , Research ) and Bear Stearns Cos. (BSC.N: Quote , Profile , Research ) this week beat estimates, posting higher revenue helped by exposure to booming mortgage markets and growth in investment banking. TRADING DRAGS RESULT DOWN The biggest drag on Goldman came from trading and principal investments, where revenue fell 22 percent to $2.81 billion. Trading revenue in most bonds, derivatives and commodities results all were lower.     Continued ... Quelle "Goldman profit down but stock up" : reuters.com Main page for "Goldman profit down but stock up"