The US investment bank Lehman Brothers has reported another slide in profits, as the stock market slump continues to hit business.

Lehman's reported net income for the March to May quarter of $296m (£198m), down from $430m for the same period last year - a fall of 31%.

The figure was in line with analysts' expectations, and Lehman's managed to post a small increase in revenues thanks to strength in its bond business offsetting downturns in equity trading and merger advice.

But the bank failed to suggest that the sector was heading for an upturn.

"In terms of outlook for the remainder of 2002, we continue to remain cautious," said Lehman's chief financial officer David Goldfarb.

Lehman Brothers is the first of several Wall Street giants to post results this week.

Morgan Stanley and Bear Stearns are due to report on Wednesday, with Goldman Sachs scheduled to follow them on Thursday.