Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and Volcker Rule

Sometime today a report from regulators will be released on the "Volcker Rule," which is an attempt to ban proprietary trading at financial institutions in the U.S. like Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS).

FBR says, "Press reports and conversations with our Washington contacts indicate regulators will release the results of their study into the Volcker Rule (the ban on proprietary trading) later today. It is our understanding that the study will call for some flexibility in the implementation of the rule, but we will need to review the study in its entirety before being able to make a final determination on its potential impact. In addition to releasing the study on the Volcker Rule, regulators reportedly will start the rulemaking process for establishing the criterion for designating a financial institution as systemically important. Should the study call be scored as a ‘win” for industry, it could serve as a positive near-term headline for more capital market–oriented names such as Goldman Sachs (GS)(Outperform) and Morgan Stanley (MS)(Outperform); however, this also is a reminder of how many key decisions have yet to be made regarding the regulation of the U.S. financial markets."

Goldman Sachs was trading at $173.51, down $1.49, or 0.85 percent, as of 12:29 PM EST. Morgan Stanley was trading at $28.62, down $0.36, or 1.26 percent.