This was the day that could have been. Earnings were coming out favorably, yet the data just couldn't support the stocks. There were also trader comments that BofA/Merrill had large sell orders or sell programs throughout the day. It looks like the DJIA even closed out under the 10,000 mark on an unofficial basis.

Here were today's unofficial closing bell levels:

Dow 9,974.75 -106.56 (-1.06%)
S&P 500 1,079.73 -13.18 (-1.21%)
Nasdaq 2,154.47 -10.82 (-0.50%)

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Elan Corp (NYSE: ELN - option chain) stock is falling today after Biogen (NASDAQ: BIIB) reported another serious brain infection in a patient being treated with Tysabri. Tysabri is a MS drug whose revenues are shared by BIIB and ELN. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on ELN.

This morning, ELN opened at $7.37. So far today the stock has hit a low of $6.87 and a high of $7.49. As of 11:15, ELN is trading at $6.88, down 48 cents (-6.5%). The chart for ELN looks neutral and S&P gives ELN a neutral 3 STARS (out of 5) hold ranking.

If you've been following Elan Corp. (NYSE: ELN) lately, you've probably come to take any story of a deal, takeover, sale with a grain of salt.

This morning, Elan shares soared over 16% after stories on Reuters and the Wall Street Journal over the weekend said it is in advanced talks to sell a minority stake to Bristol-Myers Squibb (NYSE: BMY). Moreover, Elan was said to be in talks with a second suitor, but the status of those discussions was unclear. This, Reuters reported, could be the first move in a multi-step transaction to sell Elan outright.

While the shares are still up a healthy 12% by midday, now Bloomberg reports that according to UBS analysts, Bristol isn't in talks to buy a stake in Elan.

This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.

"Biogen Idec (NASDAQ: BIIB) -- which has a highly effective though risky treatment for multiple sclerosis called Tysabri -- is our top pick for 2009," says analyst Richard Moroney.

The editor of Dow Theory Forecasts, an advisory that has been published for more than 50 years, explains, "Despite superior growth prospects, the Tysabri concerns have kept Biogen's shares under pressure.

"In the past two months, consensus profit estimates have crept upwards for Biogen Idec. Per-share profits are expected to climb 33% in 2008 and 9% in 2009. Over the next five years, profits are expected to climb 12% annually. Two factors support this outlook.

"First, Biogen plows nearly a third of its revenue into research and development, raising expectations of a fertile lineup of new drugs. Second, there's Tysabri, a highly effective though risky treatment for multiple sclerosis.

"If you want to buy a great company dirt cheap, think Biogen Idec (NASDAQ: BIIB)," says biotech expert Michael Shulman. Here's an update from ChangeWave Biotech Investor.

"Biogen recently got hammered on 'bad' news that wasn't actually so bad. BIIB and partner Elan (NYSE: ELN) reported that two MS patients, out of 31,800 currently receiving Tysabri, developed a rare brain malady called PML.

"It's important to note, here, that the two companies had predicted that one in 1000 cases could develop PML and the FDA let the drug come to market with this understanding with a strong set of patient warnings and physician follow up.

"Tysabri has succeeded in the marketplace because it is a superior treatment for MS -- and the patients who use it agree, despite its high cost of $30,000 per year. I expect only a very small drop off in market acceptance for Tysabri and when it becomes apparent the drug is still desired by patients and doctors, the stock should rebound significantly.

"BIIB is still targeting 100,000 patients by 2010 and that would translate into $1 billion per quarter in sales.The two cases of PML cut the stock by almost 30% -- and that's ridiculous. It's simply too big a move for a cash-rich, risk-free company with several major drugs -- especially Rituxan which is taking more market share every quarter.

"Biogen Idec also has the ability to add new products through licensing or direct acquisition, and I expect it to do so in the coming quarters. This temporary downturn is a godsend for investors! BIIB is now selling well below the valuations of other large-cap, double-digit biotech growers. Take advantage of this mistake before the Street wakes up."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

Biogen (NASDAQ: BIIB) was trading at $54.71 in pre-open trading, below its close of $69.76 Thursda. BIIB and Elan (NYSE: ELN) announced their multiple sclerosis treatment Tysabri, was linked to brain infection. BIIB August option implied volatility was at 42, September at 39; near its 26-week average of 39 according to Track Data, suggesting non-directional price movement.

ELN was trading at $10.78 in pre-open trading, below its close of $20.05. ELN August option implied volatility was at 65, October at 58; below its 26-week average of 70, suggesting decreasing price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

MAJOR PAPERS:

• According to people familiar with the matter, the Wall Street Journal reported that an investor group that includes Harbinger Capital Partners is expected to report a raised stake in The New York Times Company (NYSE: NYT). The raised stake is expected to be close to matching the 19% stake owned by the Sulzberger family.
• The Goldman Sachs Group Inc (NYSE: GS) has been spared many of the problems of the subprime mortgage crisis, but other areas where it's involved, such as investment banking and leveraged loans, are hurting the firms profitability, the Wall Street Journal reported.

OTHER PAPERS:

• Cablevision Systems Corporation (NYSE: CVC) is seeking to put a valuation on its Rainbow Media unit, in order to possibly sell it, sources say. In the past, the unit, which consists of several cable channels, has been valued at $3B, but the Dolan family is hoping to obtain a higher price, according to the New York Post. Possible buyers include Liberty Media Corporation (NASDAQ: LCAPA) and News Corporation (NYSE: NWS).
• Elan Corporation (NYSE: ELN) is considering splitting its biopharmaceuticals arm, which markets Tysabri, from its drug technology division, the Sunday Times noted. The potential spin-off could unlock up to $1.5B to share holders.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"My favorite speculative stock for 2008 is Elan (NYSE: ELN)," says Ken Kam, editor of Marketscope, who also featured the same stock as his favorite in last year's report.

"The stock started this year at $14 and now trades at over $24 -- up over 70% for the year, and more than triple from our original recommendation. It is hard to believe it, but I think Elan still has more room to run.

"I originally recommended it in June 2005 at $7 after the company withdrew Tysabri, a multiple sclerosis drug, from the US market. After being reapproved by the FDA nearly 17 months ago, Tysabri is used by less than 20,000 out of more than 1 million potential patients in North America and Europe.

"For all the gains we've seen so far (up 70%), these Tysabri sales have ramped up more slowly than I expected. However, next year there is a good chance that Tysabri sales will hit an inflection point where sales can more than double in a short time.

"The long-term outlook for biotech is excellent and many of today's undervalued companies will ended up looking like screaming bargains at today's prices," notes biotech expert John McCamant.

In his Medical Technology Stock Letter, the advisor has long been a fan of Biogen Idec (NASDAQ: BIIB). Now, he is joined by Carl Ichan, who has purchased shares in the biotech firm.

Says McCamant, "There may be no such thing as a pure safe haven within the equity markets. However, we believe the market for new drugs will continue to grow rapidly even if we enter into a difficult period for the economy."

He argues, "Quite simply, if an individual has to decide whether to buy a new TV or a new cancer drug, it is a safe assumption that they will chose the best drug possible. Additionally, with the continued aging of America, the demand for healthcare is poised for unprecedented growth."

As to Biogen, he explains, "We have long recommended the stock primarily for the significant growth opportunity Rituxan brings to the plate in treating autoimmune disease, most importantly rheumatoid arthritis (RA)."

Last December, over 100 stocks were featured in our Top Picks for 2007 report. Now, at mid-year, we turn to the 20 advisors whose picks showed the strongest gains to get an update on their previous picks, as well as a new favorite stock for the second half of the year.

Ken Kam, editor of Marketscope, chose two stocks in the Top Picks for 2007 report and both picks qualified him for our Top 20 Advisors. His selection of Valero Energy Corp. (NYSE: VLO) rose 48%. Here is his original recommendation for Valero and his current opinion on the stock.

In addition, Ken also picked Elan Corp. (NYSE: ELN) in our Top Picks 2007 report and its gain of 35% also qualifies among our Top 20 Advisors. Now, he is now re-recommending the shares as his current favorite for the balance of 2007.

The advisor explains, "Elan has been strong on rumors that Biogen (NASDAQ: BIIB) -- Elan's 50% partner for its multiple sclerosis drug Tysabri -- is interested in acquiring the company. Elan has also show recent strength on news that the company's Alzheimer's drug (AAB-001), which is partnered with Wyeth (NYSE: WYE), is being advanced to Phase 3 trials.

"When a stock makes a big move in a short period, there is a tremendous temptation to sell and 'lock in profits.' However, when the price move is accompanied with good news, the initial bump may be the start of a major move up. If you are too quick on the trigger, you may miss the bigger, longer term.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Elan Pharmaceuticals (NYSE: ELN) is the top speculative stock for 2007 from Ken Kam. The editor of Marketocracy's Marketscope, explains, "Last year, I also chose Elan as my top pick because I thought their multiple sclerosis drug, Tysabri, would be approved for sale again.

"It was, but it didn't happen until July. Further, the FDA then required additional testing. This slowed down the sales that I had expected and led to disappointing sales in the third quarter. However, I think this delay was a speed bump, not a brick wall. Thus, the growth I thought would occur in 2006 I now think we'll see in 2007.

"Over the next 12 months, I think Elan's price will move up as Tysabri sales accelerate in the U.S. and Europe. In addition, Elan just filed today for approval to use Tysabri to treat patients with Crohn's disease -- a patient population that may ultimately double Tysabri's sales potential.