NEW YORK (CNNMoney.com) - Goldman Sachs said Tuesday that second-quarter earnings more than doubled on strength in its investment banking and trading operations but investors focused on worries about the outlook for stocks and interest rates that could hurt Wall Street firms.

New York-based Goldman Sachs reported net earnings of $2.31 billion, or $4.78 a share, for its fiscal second-quarter ended May 26, up from $865 million, or $1.71 a share, a year earlier. Net revenue more than doubled to $10.10 billion.

Goldman earned $2.4 billion, or $4.97 a diluted share, excluding one-time items, well above analysts' average forecast of $4.28 a share.

But the results still came in below its stellar first-quarter earnings as late-quarter market volatility put some pressure on Goldman's operations. That propelled some investors to take some money off the table, and Goldman (down $3.48 to $141.52, Research) stock sank about 2 percent in afternoon trading.

Speaking on a conference call with analysts, Goldman's financial chief David Viniar said "the decline in equity [markets] hasn't been mirrored in many other markets" with continuing strength in the credit markets and no slowdown in corporate activity.

But he cautioned that if the stock market continues to trail lower, the company's business could see some slowdown.

That echoed comments made by executives at rival bank Lehman Bros., who said Monday that if interest rates rise more than expected and markets stay volatile, some businesses may be in for a rough road ahead. The news sent Lehman (down $1.78 to $60.23, Research) shares skidding Monday, and the stock fell another 2.7 percent Tuesday.

Harrell Smith, manager of institutional securities and investment at independent research and consulting firm Celent LLC, said the entire industry is keeping an eye on the direction of the market and the economy through the next six months as Wall Street tries to determine how aggressive the Federal Reserve will be under the leadership of Ben Bernanke.

"There's a lot of uncertainty right now," Smith said. "If rates go up and the equities markets continue to slide into bear territory, that could have a negative impact on earnings" for the brokerage industry.

He said while volatility, in and of itself, can help companies like Goldman Sachs make money on proprietary trading, a prolonged downturn could dry up initial public offering generation - a business in which Goldman is considered a market leader.

And he added that, for now, Goldman continues to show solid results. Goldman posted strong numbers, with investment banking revenue up 87 percent and total revenues from trading for its own account up 147 percent from a year ago.

But Fox-Pitt Kelton securities industry analyst David Trone said the company's second quarter, while impressive, still may not warrant investor buying at this point.

"We don't believe the report is impressive enough to make the market reverse its recent negative sentiment," Trone wrote in a research note. Goldman shares are more reasonably priced but "aren't yet compelling enough, in our view."

The stock could be more attractive if it falls back to the mid-$130 range, he added.

Goldman shares hit historical highs of nearly $170 a share in April before investors got a little dizzy, pushing the stock down about 15 percent since.

And the second quarter was a noisy one for the Wall Street giant, with some of its strength coming from non-core items such as a $700 million gain from the sale of a power plant.

Excluding those gains, fixed income, currency and commodities would have seen revenue drop about 3 percent from the first quarter.

Goldman Sachs also booked gains from the increasing value of the 21 membership "seats" it held on the New York Stock Exchange, which went public in March, forming NYSE Group Inc.

The company is also facing some internal changes as chairman and CEO Henry Paulson gets set to become Treasury Secretary. If his nomination is approved, as expected, president Lloyd Blankfein is slated to replace Paulson.

While CFO Viniar didn't make any comments regarding the change of guards at Goldman, he said there will be "no changes in strategy at Goldman Sachs."

After Lehman and Goldman, Bear Stearns (Research) is due to report Thursday and Morgan Stanley is scheduled to release results on June 21. According to Thomson Financial, a consensus of analysts expect Bear Stearns to post earnings of $3.12 while Morgan Stanley (Research) should report $1.45 for the quarter.

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