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After yesterday´s big rally, the US stock index futures declined as the reporting for the day has led investors down; Merrill Lynch, Pfizer and Nokia all made earning announcements below analysts´expectations.

Pfizer stock analysis

Pfizer (PFE), the world´s largest drugmaker, retreated after competition from generic medicines cut into revenue. The company earned 41 cents per share, or $2.8 billions, than was beneath the expert´s forectast of 66 cents a share.

The profit drop of 18% for its first quarter weighed on Pfizer´s stock in premarket trading, sending their shares 4% down to 20.25 dollars.

The cholesterol drug Lipitor will lose patent protection in 2010, opening the floodgates for cheaper generic versions. the outlook does not look good at all.

Merrill Lynch stock analysis 

Merrill, posted its third consecutive quarterly loss, after more than $6 billions write-downs pushed it to a bigger loss than expected. Their chief excecutive, John Thain, also cautioned that things were unlikely to improve in the next couple of quarters, giving a tough forecast.

Analysts polled by Thompson Financial projected a loss of $1.99 per share, but MER reported $2.19. On the positive side, their balance shows that they have $82 billion of excess liquidity to help protect against bad market conditions.

Also, MER announced that they will cut more than 4,000 jobs and the bad news aren´t been as tough as they should on it´s share price; they are only dropping 2% in the premarket trading. This will probably get much worse when the regular trading hours begin.

Nokia stock analysis

Nokia is the most affected company of the one´s in study by their announcement, since they are losing more than 12,5% of its market value in the pre-market trading. This news also affected Motorola, that is currently droping its price to 2,5% in the premarket.

Although they reported a 25% rise in the 1Q net income, it sounded not too good comparing to the industry growth rates. Nokia reported 0.32 euro a share of profit or 1.22 billion euros, much less than the expected by analysts earnings of 1.38 billion.

The world´s biggest maker of mobile phones said that the value of the global handset market will shrink in euro terms this year. That outlook really worried investors that started a similar massive selling of its shares, similar to the one experienced by General Electric (GE) some days ago.

The shares have lost more than a quarter of their value in the last 3 months, after reaching a high of 42.22 in past November.

Overall, we can say that yesterday´s Wall Street gain was driven by hope, and today reality appeared again. This earning season might be much worse than expected.