I remember Toronto during SARS. As one of the harder hit areas, it was not a happy place. It was the end of winter, but that miserable, cold winter just didn't want to end. People walked the streets in a gloomy haze, afraid to take the subway and giving dirty looks to anyone brazen enough to cough in public. Worse, I couldn't even visit a friend in the hospital. All things considered though, in global pandemic terms, it was over relatively quickly. Let's hope swine flu will be the same.

In the meantime, let's put on our investors hats and see what's in store for some stocks:

Travel and tourist stocks
This is one of the worst hit areas, especially airlines, as people may cancel their travel plans. For example, AMR Corp. (NYSE: AMR) traded over 9 percent lower an hour after the open. Royal Caribbean Cruises (NYSE: RCL) was down over 15 percent. In fact UBS downgraded these airlines and hotels this morning: AMR, Continental Airlines (NYSE: CAL), Host Hotels and Resorts (NYSE: HST), Lasalle Hotel Properties (NYSE: LHO), Marriott (NYSE: MAR), United Airlines (NASDAQ: UAUA), US Airways (NYSE: LCC). Carnival Cruise Lines (NYSE: CCL) also declined considerably. Best to stay away from the sector.

Pfizer (NYSE: PFE), a pharmaceutical entity whose colleagues include Merck (NYSE: MRK), Novartis (NYSE: NVS), and Johnson & Johnson (NYSE: JNJ), will be reporting first-quarter earnings Tuesday. As one has come to expect, the market believes that the company will be experiencing a decline in bottom-line income. The call is for 49 cents per share versus 61 cents per share in the year-ago period.

That's a drop of 20%. That might not sound so hot, but the good news is that Pfizer has a solid recent track record when it comes to beating earnings expectations. So shareholders might be justified in feeling confident about that aspect of the game.

Yahoo! Inc. (NASDAQ: YHOO) managed to actually beat estimates and shares traded 5.7% higher in premarket. While the internet portal company reported a fourth-quarter loss of $303 million, it actually withstood the recession better than analysts had expected as excluding charges it would have earned 17 cents per share, better than the 13 cents per share estimated by analysts surveyed by Thomson Reuters. Revenue matched analyst estimates. New CEO, Carol Bartz, can now fully take control. By 11 am, YHOO shares gained 7%.

AT&T Inc. (NYSE: T) said fourth-quarter profit fell 23% to $2.4 billion, or 41 cents per share. This despite higher wireless sales -- revenue rose 2.4% to $31.1 billion -- as it paid high subsidies to support Apple Inc's (NASDAQ: AAPL) popular iPhone and traditional phone users disconnected their service. Excluding items earnings fell to 64 cents a share from 71 cents a share. Results were roughly inline with estimates. Shares were 4.3% higher in premarket trading. By 11 am, T shared declined 2%.

Novartis (NYSE: NVS - option chain) shares have moved higher today after after a writer at the Financial Times said in an article that the company exemplifies "the resilience of the European pharmaceuticals sector in turbulent times." The article notes that Novartis is a favorite among pharmaceutical-sector analysts, and that the company's cost cuts have boosted its bottom-line despite the economic downturn. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on NVS.

NVS opened this morning at $49.34. So far today the stock has hit a low of $48.67 and a high of $49.46. As of 12:20, NVS is trading at $49.26, up $1.06 (2.2%). The chart for NVS looks neutral and S&P gives NVS a 3 STARS (out of 5) hold ranking.

For a bullish hedged play on this stock, I would consider a February bull-put credit spread below the $40 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 4.2% return in just six weeks as long as NVS is above $40 at February expiration. Novartis would have to fall by more than 18% before we would start to lose money. Learn more about this type of trade here.

NVS hasn't been below $41 at all in the past year and has shown support around $44 recently.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in NVS.

There is a lot of money sitting on the sidelines waiting for the right time to get back into the stock market. Maybe that time will be after the Dow Jones Industrial Average tests 7000, or even 6000. Maybe it will be after quarterly reports start turning positive. I'm sure many people will not do anything until the housing market turns around. Then there are those that have sworn off the stock market or at least individual stocks entirely.

These and a multitude of other issues may be keeping you from investing for now and no one could blame you, but if it is your intention to get back in when the coast is clear then you should be making some preparations by putting together your watch list.

Here are some of the stocks on my watch list. I usually have about 20 stocks that I am interested in. Some of them I own already and I am interested in acquiring more. Some have appeared in my Chasing Value column, and some or all might appear there again.

Annaly Capital Management (NYSE: NLY) is one of the stocks mentioned in Fortune Magazines "Ten Promising Stocks for 2009" and is currently paying almost a 15% yield at Fridays closing price of $14.92. The company borrows money at short term rates and only invests in long-term Federally backed mortgages. They have avoided subprime loans and derivatives entirely.

Boardwalk Partners (NYSE: BWP) is expanding and was highlighted today as another high yield value stock Chasing Value: High yield thru Boardwalk's pipes that you can acquire for less than the price the general partners paid in October.

Burlington Northern Santa Fe (NYSE: BNI) can claim Berkshire Hathaway (NYSE: BRK.A) as it's largest shareholder and you can buy shares for less than 'my pal Warren' did.

Intuitive Surgical (NASDAQ: ISRG) is one of my top holdings and favorite companies. I have owned it for years and only selling some shares at $192. I recently started building a new position in a new portfolio in the past few months and I am interested in buying more. It closed at 134.38 on Friday.

I am the Global Editor at MoneyShow.com and each week I interview an investing expert. This week, I spoke with Allan Nichols, editor of Morningstar InternationalInvestor, who identifies the pitfalls and opportunities in global market today.

Q. Allan, how can investors protect themselves should the financial crisis in the US result in prolonged bear markets around the world?

A. Studies have shown the majority of returns from the stock market have been concentrated over a relatively few days, so it is important to have some exposure. My experience, though, has shown bear markets last longer than you think. Asset allocation is particularly important and I would increase cash from my bond allocation rather than from my stocks. Now is the time to buy really high-quality stocks at attractive prices, those that have sustainable advantages, or what Morningstar calls "moats."

Morningstar borrowed the concept of a moat from Warren Buffett. Just as a moat around a castle protected the castle from invaders, a company's moat protects the firm from competition. Moats can be generated from being the low-cost producer; having intangible assets, such as patents or other unique intellectual property; and high switching costs that make it uneconomical to change to another product or service. All of these improve a firm's ability to compete as well as earn returns above its cost of capital.

Analyst upgrades:

• Credit Suisse upgraded shares of Novartis (NYSE: NVS) to Neutral from Underperform as they believe the stock's defensive characteristics justify a premium valuation.
  
• Merrill raised Dreamworks (NYSE: DWA) to Buy from Neutral and has increased confidence in DWA's sustainable success following the performance of Kung Fu Panda and new revenue streams.
  
• Anadarko Petroleum (NYSE: APC) was raised to Buy from Hold at Stanford on valuation.
  
• Goldman upgraded Smurfit-Stone (NASDAQ: SSCC) and Canadian National (NYSE: CNI) to Buy from Neutral and added International Paper (NYSE: IP) to the Conviction Buy List.
  
• Northern Trust (NASDAQ: NTRS) was upgraded to Buy from Neutral at Merrill.

Analyst downgrades:

• Jefferies downgraded shares of Savvis (NASDAQ: SVVS) to Hold from Buy and lowered the target to $17 from $20 to reflect decreasing visibility from economic headwinds and expectations for increased capex.
  
• Citigroup downgraded Regions Financial (NYSE: RF) to Sell from Hold as they believe fundamentals are not in-line with the current valuation following the recent rally.
  
• Merrill lowered their General Electric (NYSE: GE) estimates below consensus and downgraded shares to Neutral from Buy citing increased fundamental pressures on the company's GE Capital unit. GE's target was cut to $28 from $37.50.

Analyst upgrades:

• Goldman upgraded shares of Novartis (NYSE: NVS) to Buy from Neutral as they believe the Alcon (NYSE: ACL) acquisition has diversified the company's business.
  
• Tyson Foods (NYSE: TSN) was upgraded to Equal Weight from Underweight on valuation.
  
• JP Morgan raised Albermarle (NYSE: ALB) to Overweight from Neutral.
  
• BMO Capital upgraded Wynn Resorts (NASDAQ: WYNN) to Outperform from Market Perform.
  
• Synovus Financial (NYSE: SNV) was lifted to Buy from Hold at Sterne Agee.

Analyst downgrades:

• Morgan Stanley downgraded Reynolds American (NYSE: RAI) to Underweight from Equal Weight based on the impact from Altria's (NYSE: MO) purchase of competitor UST (NYSE: UST), which may result in pricing pressure.
  
• Goldman downgraded AstraZeneca (NYSE: AZN) to Sell from Neutral as they believe shares do not support near-term fundamentals.
• Max Capital (NASDAQ: MXGL) was downgraded to neutral from Buy at Banc of America.
  
• AudioCodes (NASDAQ: AUDC) was lowered at Merrill to Neutral from Buy.
  
• Pinnacle Financial (NASDAQ: PNFP) was downgraded to Neutral from Outperform at Baird.

U.S. stock futures were much lower Thursday, indicating a tough start for Wall Street today -- the seventh anniversary of the 9/11 attacks. Investors sentiment was mired by concerns over the financial sector as Lehman and WaMu continue to have difficulties and braced themselves for a slew of economic reports including weekly initial claims, trade deficit for July and inflation figures for international trade for August. Meanwhile, oil declined as Saudi Arabia broke ranks on OPEC.

Lehman Brothers Holdings Inc. (NYSE: LEH) tried to calm investors Wednesday when it presented its rescue plan including the sale of its investment arm. But investors don't seem convinced and are frustrated with the company and its CEO, the longest serving CEO on Wall Street. Too much planning and intent, not enough action. After plunging 45% Tuesday, LEH stock was down another 7% or so Wednesday to $7.25 on Wednesday. They are shedding another 14.5% in pre-market trading at 7:32 am.
[Update 9:00 a.m.: Following the several downgrades, Lehman shares are plunging over 40% in pre-market trading. Stock futures are drastically lower as well, indicating stock will likely open much lower.]

Washington Mutual (NYSE: WM) shares have been sharing the same fate as Lehman's lately, as they plunged to their lowest point in nearly two decades Wednesday, diving 29.7% to close at $2.32 - a 17-year low. As of 7:33 a.m., shares are declining another 2.6% in pre-market trading. WaMu is expected to have losses in its mortgage portfolio expected of $19 billion, and some believe it could be Wall Street's next casualty.

And as if that wasn't enough, The Wall Street Journal reports that there will be hearings on alleged tax shelters provided to hedge funds by investment banks including Citigroup (NYSE: C) and Merrill Lynch (NYSE: MER).

JP Morgan downgraded Novartis (NYSE: NVS) to "neutral" from "overweight", according to Briefing.com. The news service also reports that Citigroup added Freeport McMoran (NYSE: FCX) to its "Top Picks" list.

American International Group (NYSE: AIG) Started as Sell at Societe Generale, according to 24/7 Wall St. The financial site Limelight Networks (NASDAQ: LLNW) Raised to Buy at Jefferies.

Amgen (NASDAQ: AMGN) is a biotechnology firm engaged in the discovery and manufacture of human therapeutics. It markets products in the areas of supportive cancer care, nephrology, inflammation, and metabolic diseases. Principal offerings include anemia treatments Aranesp and Epogen, rheumatoid arthritis drug Enbrel, and white blood cell stimulator Neupogen. Amgen has marketing alliances with Hoffmann-La Roche and Kirin. Baxter International (NYSE: BAX), Johnson & Johnson (NYSE: JNJ) and Novartis (NYSE: NVS) and major competitors.

The company pleased the Street late last month, when it announced Phase 3 trial results showing that its experimental osteoporosis drug significantly reduced the risk of bone fractures in post-menopausal women. As well, the firm reported Q2 EPS of $1.14 and revenues of $3.76 billion. Both measures topped consensus Street estimates ($1.02, $3.58 billion). Management also guided FY08 EPS to $4.25-$4.45 ($4.19 consensus) and FY08 revenues to $14.6-$14.9 billion ($14.42B consensus). Eight brokerages subsequently declared AMGN a "buy" and issued price targets in the range $67-$80.

Before the bell: Futures lower ahead of Bernanke speech, Alcoa; Indymac plunges

Industrial conglomerate Siemens AG (NYSE: SI) said Tuesday it would cut 16,750 jobs, or 4.2% of its global work force of 400,000 people. Most of the cuts would be administrative jobs. Siemens is attempting to cut nearly $2 billion in costs by 2010 as a slowing economy is affecting its business.

Office Depot (NYSE: ODP) shares are sinking 13.5% in premarket trading after the office-supplies retailer said that "pressure from weakening business conditions" has hurt second-quarter sales, and forecast a nearly 10% drop in second-quarter North American same-store retail sales.

General Motors (NYSE: GM) and Ford (NYSE: F) shares are declining 1.5% and 2.2% respectively in premarket trading despite reporting strong first-half sales in China, where the auto market is booming. GM said sales of its brands rose 12.7%, and Ford said its sales rose 21%.

"The pipelines of most Big Pharmas are bone dry; last year, the FDA approved the lowest number of new drugs (19) since 1983," notes Louis Basenese, editor of The Oxford Club.

"But opportunity always lurks in the wreckage, and one Big Pharma, in particular, is being unfairly punished." Here's his bullish outlook on Novartis (NYSE: NVS).

"Unlike others in the sector, Novartis doesn't suffer from an empty pipeline. It's launched more drugs globally than any other firm in the past seven years. It has more than 100 projects in phase II (or later) trials. And it expects to file at least six new drug applications this year alone.

"Plus, its products cover all bases, from vaccines to specialized drugs to generics to eye-care products, even animal health items. And most are enjoying rapidly expanding sales.

"Moreover, the company maintains a fortress-like financial position that includes a $10.8 billion cash horde. Management keeps raising the dividend, for 11 years and counting. And it recently announced a massive $9 billion stock-repurchase plan, too. Hardly the hallmarks of a sickly stock.

Before the bell: Futures higher on SBUX, YHOO, ahead of inventory report

Deutsche Bank (NYSE: DB) shares are trading 4.2% higher in premarket action after the bank, seeking to calm investors, said it expects a profit in its second quarter.

While AT&T Inc. (NYSE: T) unveiled its pricing strategy for Apple Inc. (NASDAQ: AAPL)'s 3G iPhone to go on sale July 11 with a $199 and $299 (with contract) price points as expected, Canadians are outraged over Rogers Communications Inc. (NYSE: RCI)'s 3G iPhone rates and have created an online petition that collected over 19,000 signatures already.

AstraZeneca (NYSE: AZN) rose in Europe and is rising over 2.7% in premarket trading after winning a court case against Teva Pharmaceutical (NASDAQ: TEVA) and the Sandoz unit of Novartis (NYSE: NVS) over patents on its Seroquel schizophrenia drug.

A day after car sales were seen as "not as bad as expected," comes Merrill Lynch and downgrades General Motors (NYSE: GM). Shares are down over 3% in premarket trading.

Novartis (NYSE: NVS) shares are trading higher today after an analyst at BNP Paribas upgraded the stock to "Neutral" from "Underperform," saying that Novartis was the "surprise winner" at a recent oncology conference. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on NVS.

After hitting a one-year high of $59.17 in January, the stock hit a one-year low of $46.19 in April. NVS opened this morning at $53.23. So far today the stock has hit a low of $53.06 and a high of $53.83. As of 12:10, NVS is trading at $53.51, up $1.92 (3.7%). The chart for NVS looks neutral but deteriorating, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider an October bull-put credit spread below the $45 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 5.3% return in four months as long as NVS is above $45 at October expiration. Novartis would have to fall by more than 15% before we would start to lose money. Learn more about this type of trade here.