Merrill’s Earnings Announcement Throws Cold Water on Financials

Posted by Patrick O'Connor on 7/17/08 2:02 pm

U.S. financial stocks rebounded significantly off their lows during the past two trading sessions, but Merrill Lynch’s second-quarter earings announcement after the market’s close today unleashed a dose of cold reality about the financial sector’s poor condition.

Merrill wrote down a staggering $9.75 billion for the quarter, substantially more than the $6 billion expected by analysts, and it recorded a net loss of $4.97 billion, also much more than expected.  Read More.

Moody’s cuts Merrill’s debt rating.

The results were sobering for those who were feeling the worst was behind the financial sector. Merrill’s stock is down 6% in aftermarket trading.  Now all eyes are on Citigroup’s earnings report tomorrow.

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