Morgan Stanley on Friday reported a drop in third-quarter profit, as a slowdown in global dealmaking hurt the investment bank’s core underwriting business, sending shares down 3% before the bell.

The outlook for deals has steadily worsened this year as the U.S. Federal Reserve raises interest rates to tame inflation, clouding the economic growth outlook, while the highs of a record last year draws tough comparisons.

Global M&A lost ground for the third straight quarter with volumes in the U.S. plummeting nearly 63% as the rising cost of debt forced companies to delay big buyouts.

Turmoil in the financial markets triggered by the Ukraine war and rapidly rising interest rates have depressed investor sentiment, prompting companies to delay going public.

Morgan Stanley joins rivals, JPMorgan Chase and Co and Well Fargo & Co also reported a similar hit to their quarterly profit on Friday amid an uncertain economic conditions that have led banks to build rainy day funds.

Net revenue in the quarter fell 12% to $13 billion.

The bank reported a profit of $2.49 billion, or $1.47 per share, for the quarter ended Sept. 30, compared with $3.58 billion, or $1.98 per share, a year earlier.

Analysts on average had expected a profit of $1.49 per share, according to Refinitiv data. It was not immediately clear if the reported numbers were comparable with the estimates.