MF Global sees loss but shares soar

NEW YORK (Reuters) - Futures and options broker MF Global Ltd MF.N said on Friday it expects record trading volumes and net revenue in the fiscal fourth quarter and its shares rose nearly 30 percent.

Despite the robust trading and revenues, MF Global said it expected to post a loss for the quarter ended March 31, mainly due to a previously disclosed bad debt provision.

On February 28, the company said it was taking a provision of $141.5 million as a result of unauthorized trading by a broker in the volatile Chicago wheat market.

MF Global has blamed the loss on one trader making unauthorized deals. The Commodity Futures Trading Commission, which regulates the U.S. futures industry, said the incident appeared to be isolated.

"Most people believe MF Global came clean today, disclosing what their fourth quarter loss would be, which was less severe than what was originally anticipated," said William Lefkowitz, options strategist at brokerage firm vFinance Investments.

Shares of MF Global were up 28 percent to $14.78 in afternoon trading on the New York Stock Exchange.

Optionmonster.com founder Jon Najarian said the shares were driven by Morgan Stanley adding MF Global to its focus list.

MF Global expects a pre-tax loss of $55 million to $65 million in the fourth quarter. On an adjusted basis, it sees a pre-tax profit of $75 million to $85 million, compared with a $66.9 million profit in the year-ago quarter.

MF Global said it expects net revenue for the fourth quarter of $440 million to $460 million, up from $376.6 million last year.