Electronic trading service Knight Capital ( NITE) posted a 71% drop in first-quarter earnings on Tuesday, primarily as a result of an after-tax charge of $20.5 million tied to its discontinued asset management business, Deephaven Capital Management.

Excluding that loss, Knight Capital reported earnings from continuing operations of $29.9 million, or 33 cents per share. On that basis, the performance beat the consensus estimate of analysts surveyed by Thomson Reuters, who expected a profit of 29 cents per share, on average.

In addition, the firm's daily trade volume and the dollar value of its trades both saw growth in March.

The news sent shares up 7% in afternoon trading to $16.08.

"The major market indexes reversed course mid-month, spurring activity among diverse market participants and driving broad stock market volumes," Chief Executive Thomas Joyce said in a statement.

Net income for the first quarter was $9.4 million, or 10 cents a share, compared with $32.5 million, or 35 cents a share, in the year-ago period. Revenue rose 26% to $245.4 million.
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

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