(Bloomberg News) James Gorman, chief executive officer of Morgan
Stanley, bought $2.06 million of stock in the firm as the shares today
touched their lowest level since March 2009.
Gorman bought 100,000 shares today at a weighted average price of $20.62, according to a filing with the U.S. Securities and Exchange Commission. The purchase, which was larger than his cash bonus for 2010, increased Gorman's holdings to 955,370 shares, worth about $20 million at yesterday's closing price of $21.02. It was Gorman's first outright purchase since he became CEO of the New York-based firm at the start of 2010.
Morgan Stanley fell 23 percent this year through yesterday, making its shares worth 30 percent less than book value. The bank's puts were the most active in the U.S. equity-options market yesterday after an investor bought a block of contracts with a strike price 25 percent below the previous day's closing level.
Morgan Stanley shares fell 63 cents, or 3 percent, to $20.39 at 11:11 a.m. in New York Stock Exchange composite trading. They earlier touched $20.21, lower than any closing level since March 9, 2009.
A trader yesterday purchased 34,532 October $16 puts to sell Morgan Stanley shares for 28 cents each, according to data compiled by Bloomberg. It was the biggest trade in Morgan Stanley's puts since January 2010, according to Henry Schwartz, president of Trade Alert LLC, a New York-based provider of options-market data and analytics.
The stock jumped 11 percent on July 21 after Morgan Stanley reported a smaller loss than analysts estimated on higher trading revenue. It has dropped 13 percent since then through yesterday, as financial companies in the Standard & Poor's 500 Index retreated amid concern the U.S. recovery is weakening and the European sovereign-debt crisis will spread.