Shares of Bank of America (BAC) and Morgan Stanley (MS) rose Thursday as the banks' earnings beat Wall Street's low expectations on one-time events and improving results.

However, both companies, whose shares have plunged more than 40% over the past 52 weeks, remain far from a recovery.

Net income at Bank of America was $2.0 billion, or 15 cents a share, reversing a year-ago loss of $1.2 billion, or 16 cents a share. Revenue at the second-largest U.S. lender rose 11% to $25.1 billion.

Morgan Stanley posted a smaller-than-expecte​d loss of $250 million, or 15 cents a share, on strong trading revenue. Revenue plunged 26% to $5.71 billion.

But "the bar is pretty low," Ralph Cole, a senior vice president in research at Ferguson Wellman Inc., told Bloomberg News regarding Morgan Stanley's results. "If they can show less weakness than their peers, that appears to be strength."

Indeed, the underlying business of both companies is not great. For instance, net income at Bank of America's global wealth and investment management business fell 22% from the year-ago quarter to $249 million as higher net interest income and asset management fees were offset by lower transactional activity. Revenue was flat at $4.16 billion. At Morgan Stanley, underwriting revenue of $477 million fell 54% from last year's fourth quarter, while advisory revenue fell 16% to $406 million.

The banks' results follow a better-than-expected​ report Wednesday from Goldman Sachs (GS) and underscore the growing sense of optimism among some investors that the U.S. will avoid further recession.

The positive news keeps coming, including Thursday's report that the number of applications for first-time jobless benefits fell last week to a four-year low. Nonetheless, the data are not strong enough for investors to pop champagne corks and start signing "Happy Days Are Here Again."

Jonathan Berr is a freelance business writer.