ANTIQUES SHOPS

* Revenue falls 2 pct

* Fixed income rev up 31 pct; investment banking down 10 pct

* Asset management fees, income from funds down 82 pct

* Shares rise 3 pct (Adds details from conference call, analyst comments, updates share movement)

By Tanya Agrawal

June 19 (Reuters) - Investment bank Jefferies Group Inc's profit beat muted Wall Street expectations, helped by a strong performance by its fixed income business as investors sought safety in bonds.

As the first investment bank to report earnings, Jefferies is often viewed as an indicator for larger Wall Street banks such as Goldman Sachs Group and Morgan Stanley.

Analysts have cut their targets on several investment banks over the last two months due to weak equity markets and a growing crisis in Europe.

Jefferies has been looking to expand overseas and is reportedly planning to establish a European financing arm this year in an effort to grab market share from rivals scaling back corporate lending.

"In Europe, we're seeing capital markets start to take share from the banks in terms of debt financing and that's definitely something that is giving us some momentum in investment banking and fixed income in that region," a company executive said in a post-earnings conference call with analysts.

Although Jefferies' fixed income business held up well during the quarter, its investment banking and asset management business failed to live up to the expectations.

Fixed income revenue rose 31 percent to $293 million, while investment banking revenue fell 10 percent to $297 million.

(For a Breakingviews column on Jefferies )

The midsized investment bank earned $63.5 million, or 28 cents per share, compared with $80.6 million, or 36 cents per share, a year earlier. Revenue fell 2 percent to $711 million.

Excluding items related to its acquisition of historic British stockbroker Hoare Govett from Royal Bank of Scotland and other items, the company earned 31 cents per share.

Analysts had expected the company to earn 28 cents per share, according to Thomson Reuters I/B/E/S.

"It's earnings won't really see any momentum on the upside till the fall, because it will be unable to outperform the weak markets," said Richard Bove, analyst with Rochdale Securities.

Jefferies shares had come under intense pressure after brokerage MF Global Holdings Ltd filed for bankruptcy in October 2011 as investors worried that Jefferies might have similar troubles.

The company has since taken steps to boost investor confidence by selling billions of dollars worth of Greek, Irish, Italian, Portuguese and Spanish debt in a matter of days.

Shares of the New-York based company, which have fallen about 6 percent since the beginning of the year, rose 3 percent to $13.53 on Tuesday morning on the New York Stock Exchange. (Reporting by Tanya Agrawal in Bangalore; Editing by Supriya Kurane)