Morgan Stanley has said it expected fourth-quarter earnings to be reduced by about $2.5bn (£1.2bn) from a write down of its US sub-prime exposure. Financial Times, The Times, Daily Telegraph

It said revenue had been reduced by $3.7bn for the two months to the end of October because of the write down.

Morgan Stanley shares closed down $3.32, or 6%, at $51.19. The shares then rose to $53.45 in after-hours electronic trading.