Most eyes will be focused on the Bank of England’s rescue package for the money markets. However there are still plenty of company earnings to grapple with including Q1 from US pharma giant Merck due on Monday. Analysts are forecasting earnings per share of around 86 cents on sales just over $6bn.

Of particular interest will be sales of a cholesterol drug called Vytorin, which had annual sales of a whopping $5bn. The success (or otherwise) of this drug has a major influence on the Merck share price. Recently the shares plummeted 15% after a study suggested that Vytorin should only be used as a last resort after other, cheaper drugs have been tried first. Ongoing litigation issues with another drug called Vioxx and allegations surrounding the falsification of clinical data continue to swirl around the company.

Following show-stopping results from Google attention will be on Yahoo which is due to report Q1 earnings after the market closes on Tuesday. These numbers are likely to be a key determinant in deciding the fate of the company.

Yahoo is expected to post earnings of about 10 cents on revenues of $1.4bn-but as the company is facing a takeover bid from Microsoft one might also expect a pretty robust defence to accompany the statement. Given the strong results from Google it could well be that Yahoo’s advertising revenue was a casualty in Q1.

Industry data just released points to early signs of slowing ad revenue for the whole industry in Q2, so analysts will be anxious to hear Yahoo’s views on this.

A tense time for Yahoo; poor results will leave them in a weak bargaining position as they try to fight off the Microsoft bid. A strong set of results would instill some confidence in the Yahoo management team and might enable them to exact either a higher price from Microsoft or find an alternate buyer.