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The past few weeks have been focused on one of the biggest debt crises in U.S. history, as lawmakers sought to find a way through a $14.3 trillion pile of debt. While major equities have suffered their worst stretch in over a year, this quarter’s earnings season has taken a back seat to the debt drama, as numerous bellwethers have seemingly reported under the radar. Typically, earnings season takes the reins of the market for a few weeks once a quarter, as the performance and outlook of multinational firms is often a telling sign of individual industries as well as the economy overall.

While the debt ceiling may be making all of the headlines, it is still important for investors to focus on the earnings reports from some of these industry leaders, to get a sense for how the latter half of 2011 will play out.

Today, prior to market open, Pfizer will be reporting their most recent fiscal quarter results. Pfizer (NYSE:PFE) is the number one ranking pharmaceutical company in the world in terms of overall sales and the firm is home to over 100,000 employees as well as many brand name drugs like Lipitor, Lyrica, and Celebrex. The company is headquartered in New York City and has been under the microscope as it approaches its patent cliff, along with many other pharma giants. In particular, Pfizer’s top-selling Lipitor is set to go off patent later this year with generic competitors launching in November. Though generic prices are not expected to be immediately cheaper, over time they are expected to fall to just one-third of Lipitor’s retail value, putting major pressure on the company.

As far as their earnings are concerned, analysts have predicted that the company will haul in EPS of $0.59 with revenues somewhere near the $17 billion range. These figures would represent a 2% drop from this same quarter last year, and even more worrying, the firm’s sales are expected to contract by 1.8% for the fiscal year, and 5.5% in 2012. While Pfizer has done well to meet their earnings expectations, it will be their outlook that will likely guide their stock through the day, especially considering the impending loss of one of their most profitable drugs [see also ETF Research Report Now Available: China ETFs In Focus].

With this major earnings announcement on tap, today’s ETF to watch will be the HOLDRS Merrill Lynch Pharmaceutical (NYSEARCA:PPH). Pfizer (PFE) accounts for over 20% of this ETF which allocates its assets to 14 major pharma companies including Merck (NYSE:MRK) and Johnson & Johnson (NYSE:JNJ) as well. PPH has returned a healthy 6.8% on the year, though the past few weeks have been devastating as the U.S. economy has put major pressure on this exchange traded fund as well as equities across the board. If Pfizer meets their marks and provides a decent outlook, then look for this stock to gain on the day, but a negative report or forecast from the pharma giant could wreak havoc on this already battered ETF.

Disclosure: Author is long PFE.

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Source: Pfizer's Earnings Bring Pharma HOLDRs Into Focus