The banks remained in focus as Morgan Stanley (MS)  reported earnings that showed the bank benefiting from increased trading revenue and tax benefits. Morgan Stanley was also no slouch in M&A where they continued to be one of the leaders in the bulge bracket. The firm finished No. 2 on The Deal's first half league tables, just behind Goldman Sachs (GS)  , which reported earnings a day earlier. Morgan Stanley advised or providing financing on 142 deals in H1 according to data from The Deal, just behind Goldman's 162. So far in 2018, Morgan Stanley has worked on a number of big-ticket deals. It is working with Cigna (CI)  in its ongoing deal with ExpressScripts (ESRX)  ; General Electric (GE)  on the sale of its transportation unit to Wabtec (WAB)  ; Sky in dealings with Comcast (CMCSA)  and Fox (FOXA)  ; Pinnacle (PFI)  in its sale to Conagra (CAG)  ; Juno in its sale to Celgene (CELG)  ; Gramercy Property in its sale to Blackstone (BX)  ; and GitHub in its sale to Microsoft (MSFT)  , among other deals. Going forward, as deal volume is expected to stay steady through 2018, Morgan Stanley will likely be in heavy competition with Goldman for top bankers and large cap deals. But as with Goldman,you could see a push more into the middle market. We're not saying these guys will be doing really small deals, but we do see an increased emphasis on the middle market by both firms, which could spur competition for mandates and fees. It should also be noted that with more activists pushing for deals and PE warming back up to the leveraged buyout, Morgan Stanley's expertise in M&A defense could play a role in new mandates. Morgan Stanley was integral in defending Unilever UL in its defense against Kraft Heinz's (KHC)  unwanted bid--Morgan Stanley and Dutch takeover laws, of course.

While the EU argues its latest ruling against Alphabet (GOOGL)  will benefit consumer choice, its main result could be to take money out of Google's pocket and put it into those of Android phone makers. That is, of course, assuming that the EU's ruling stands the test of time. Given the history of past EU rulings against major U.S. tech firms, that's not a given. Either way, should the EC's Android ruling remain in place, it's pretty unlikely that Google's European search share will be seriously hurt by Android OEMs having the freedom not to pre-install Google Search and Chrome, and no longer being paid to exclusively pre-install Google Search, writes TheStreet's Eric Jhonsa. The more likely outcome is that Samsung (SSNLF)  and various other OEMs will be able to demand higher ad revenue-sharing payments in exchange for agreeing to pre-install Google Search and Chrome on their Android phones. That's the same as how Apple is able to obtain huge ad revenue-sharing payments from Google in exchange for making Google the default search engine for Safari and iOS's core search feature.

Markets Today: Stocks ended mostly higher on Wednesday, July 18, following an upbeat assessment of the U.S. economy from Federal Reserve Chairman Jerome Powell and after Morgan Stanley's second-quarter earnings topped Wall Street forecasts. The Dow Jones Industrial Average rose 0.3% to 25,199, the S&P 500 rose 0.22% and the Nasdaq fell 0.01%.

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