On Friday, the Labor Department announced that nonfarm payrolls fell by 20,000 in April, much less than economists' consensus estimates of 78,000 jobs lost, and significantly better than the average of 80,000 jobs lost each month in the first quarter. In addition, on Thursday, the Labor Department announced that weekly unemployment claims surged by 35,000 to 380,000, to the highest level in over five weeks. But in a statistical fluke, the unemployment rate fell to 5%, down from 5.1% in March, because more (362,000) unemployed workers got jobs in April than were laid off.

In other labor news, April wage inflation was in line with overall inflation, as average hourly rates increased by 3.4% in the last 12 months. However, that was offset by fewer hours worked and less overtime. The average work week fell to 33.7 hours and overtime in factories also fell. The bottom line is that, due to a weakening labor market, there is essentially no wage increase. As a result, further payroll losses are possible in May, so the May unemployment rate could rise.

One of the reasons more payroll losses are possible is due to the woes at Detroit's Big 3 auto makers. The U.S. manufacturing sector contracted for a third consecutive month in April as lower domestic demand put a damper on factory output, even as exports continued to rise. The Institute for Supply Management's (ISM) manufacturing index held steady at 48.6 in April, but that's still below a neutral reading of 50, which marks the inflection point between growth and contraction. Many manufacturers have been hit by rising energy costs and slowing U.S. demand, which have cut into order books. Some businesses have been able to offset these problems by selling more goods overseas as the weaker dollar makes U.S. goods seem more affordable to foreign buyers.

One of my favorite stocks in my Quantum Growth service is Marvel Entertainment (MVL), which is in the superhero business. Yesterday, the company reported first-quarter earnings of 58 cents per share which easily beat Wall Street's consensus of 43 cents per share. The stock gapped up nearly 10% in yesterday's trading. The company also raised its profit guidance for this year.

That wasn't the only good news for Marvel. The opening weekend for the new Iron Man movie was a smash. The movie brought in over $100 million, and over $200 million for its global haul. This was so big that one analyst said that Iron Man will contribute 55 cents per share to Marvel's bottom line. His earlier forecast was for just 15 cents per share.

You probably won't be surprised to hear that Iron Man 2 is scheduled to be released in 2010.

On March 17, the stock market tumbled on the news that Bear Stearns had collapse and was being taken over for just $2 a share by JPMorgan Chase. I couldn't believe some of the bargains I saw, and I urged my Emerging Growth subscribers to load up on fundamentally superior stocks. Here's how some of our top Emerging Growth stocks have performed since March 17:

Graham Corp. (GHM) +76.9%
General Steel (GSI) +75.0%
GrafTech International (GTI) +61.4%
Synaptics Inc. (SYNA) +54.7%
Cypress Semiconductor (CY) +49.4%

In the most recent issue of Emerging Growth, I recommended selling Crocs (CROX) after its earnings came out on May 8. The company guided Wall Street higher and the stock jumped up yesterday, so this is a great opportunity to sell Crocs into strength. Despite the higher guidance, I still recommend selling Crocs due to rising volatility.

Shares of Research In Motion (RIMM) touched a new all-time high today above $143 a share. Just three months ago, RIMM was forming a base at $84 a share.

From MarketWatch:

Before the opening bell, Research In Motion said it will launch the new BlackBerry Bold in markets across the globe later this summer. The device will be available in North America through an exclusive relationship with AT&T sometime later this year, according to an AT&T spokesman.

Shares of RIM set a new all-time high on the news, trading up more than 6% at $141.55 by midday. The stock had already surged by more than 60% over the last four months, having recovered fully from a sharp selloff in late 2007.

The Waterloo, Ontario-based company announced the news on the same day as its annual meeting with Wall Street analysts. At the meeting, RIM affirmed its forecast for revenue between $2.23 billion and $2.3 billion for the quarter ending on May 31, according to one analyst who was present at the event.

"The combination of a strong new phone (due in summer) combined with continued backing of its financial outlook has the shares up today," Cowen & Co. analyst Matthew Hoffman wrote in a brief note to clients.

I first recommended RIMM in Blue Chip Growth in February 2007, and we already have a 242% gain.

Wall Street is now officially confused as to whether we're entering a recession or not. I've heard enough from the analysts, now let me hear from you! How are economic conditions in your area compared with one year ago?

Update: Thanks for all of your responses. The consensus definitely shows that the economy is weaker today than it was one year ago. However, the largest block of votes indicates that the economy is only "slightly weaker" than it was last year.

One of my new buys in the May issue of Blue Chip Growth, Fluor (FLR), is up strongly on very good earnings news, and much higher guidance. The company is one of the leading international engineering and construction firms.

For the first quarter, Fluor earned $138 million or $1.50 a share. That beat Wall Street's estimate by 23 cents a share. The company also announced a big increase in its guidance for this year. Earlier, Fluor expected 2008 earnings-per-share between $5.10 and $5.50. Now the company sees earnings coming in between $6.25 and $6.55 a share. That's an impressive vote of confidence. Fluor also announced that its stock would split 2-for-1 on June 16.

In our Emerging Growth service, please note that The Warnaco Group has hopped over to the New York Stock Exchange, and is now trading under the symbol WRC.

The Energy Department announced on Friday that it would stop sending oil to the U.S. Strategic Petroleum Reserve (SPR), three days after Congress overwhelmingly passed a bill that would temporarily halt such shipments. Specifically, the Energy Department said that it would not sign contracts this year to receive and transport up to 13 million barrels of crude to the reserve sites, which the Bush administration had increased by 30% since 2001. On Tuesday, the White House confirmed that it would not veto the new legislation. Currently, the SPR contains 702.7 million barrels. Under the 2005 Energy Act, Bush had intended to top out that tank at one billion barrels.

Last Friday, President Bush visited Saudi Arabia (after stopping in Israel), in an attempt to coax that oil-rich nation to increase its crude oil production. The last time President Bush met with King Abdullah, back in mid-January, he received a chilly response. This time, however, the Senate Democrats also introduced a resolution that would block $1.4 billion in arms sales to Saudi Arabia unless Riyadh agrees to increase its oil production by one million barrels per day. The Democrats said they introduced this measure to coincide with President Bush's trip in order to put pressure on Saudi Arabia to pump more oil soon, to reduce the cost of gas for Americans.

Ironically, Saudi Arabia had already been exceeding its Organization of Petroleum Exporting Countries (OPEC) quotas for the past six months. For instance, on Thursday OPEC said Saudi Arabia produced nine million barrels a day in April, down slightly from March, but still 100,000 barrels per day over its quota of 8.9 million barrels a day. After President Bush's visit, Saudi Arabia pledged to increase its crude oil production another 300,000 extra barrels per day above current levels. Ali Naimi, Saudi Arabia's oil minister, said after meeting President Bush that the kingdom's crude oil output would hit 9.45 million barrels per day by June, just in time for peak summer driving season. It will be very interesting to see if crude oil prices will finally stabilize.

Meanwhile, global steel prices have risen by over 40% since December and appear to be headed higher, especially since ArcelorMittal, the world's largest steel company, boosted its prices by 20% per metric ton in Europe, due to higher costs for iron ore and transportation. Contracted iron ore prices have already risen 71% this year. Two other crucial steelmaking ingredients, coking coal and scrap steel, have doubled in price. This surge in raw-materials prices is mostly due to tight supplies and soaring demand, fueled in part by the rapid industrialization of China, India and other developing nations - and the world's voracious appetite for steel shows little sign of easing.

Some nations are hoarding steel by erecting export barriers. For example, India recently imposed a 15% duty on exported steel. Some other countries, which do not make much steel, are slashing import taxes in an effort to attract more steel. For example, Iran announced last month that it was lowering its import tax on rebar steel, which is used in new buildings and roads, to 9% from 20%. This is one reason why I'm so bullish on shipping and steel stocks.

One of the top performing stocks in my Emerging Growth service is Peerless Manufacturing (PMFG). I added it in the April issue of Emerging Growth and it's already up 40% for us in less than 40 days of trading.

Here's a company description from Hoovers:

Peerless is without peer when it comes to putting products in pipes for purposes of removing contaminants. The company's separation filtration systems are used to remove solid and liquid contaminants from natural gas and to remove saltwater aerosols from the air intakes of marine gas turbine and diesel engines. Customers include natural gas producers and shipbuilders. Products of the company's other business segment, environmental systems, include selective catalytic reduction (SCR) systems, which are used to convert nitrogen oxide produced by the burning of fossil fuels into nitrogen and water vapor. SCR systems are sold to power producers, construction companies, and refineries.

I've gotten a lot of emails recently about my trading service, Quantum Growth. I'm happy to report that our Quantum returns have been very strong over the past several weeks. Since so many people have asked about Quantum, I thought I'd give a sneak peek at our most recent But List.

Each week, we highlight our Top 5 buys of the week. Here are #3, #4 and #5 for this week:

3. Flowserve (FLS) moves up to my #3 spot this week. The company recently had a blow-out earnings report. For the first-quarter, FLS earned $1.53 per share, which creamed the 94 cents a share that Wall Street was expecting. For 2008, the company foresees earnings of $5.90 to $6.20 per share, which was raised from its previous estimate of $5.10 to $5.40 per share. Flowserve continued to rally last week and remains a great buy.

4. Occidental Petroleum (OXY) is headed to World Bank arbitration with Ecuador regarding its lawsuit seeking $1 billion in damages. The company is alleging its property was confiscated illegally when Ecuador canceled its operating contract in May 2006 and nationalized its oil fields. In a separate case before the court, Ecuador recently reached a settlement with Occidental to return $100 million in taxes. The company had originally said it was due a $171 million refund, and Ecuador's energy minister called the agreement a victory. The stock continues to rally with crude oil prices. OXY is a great buy.

5. Unibanco (UBB) recently announced that its first-quarter earnings rose 27.5% due to strong growth in its loan portfolio. Last week the Brazilian government announced an economic stimulus package that it said would provide the equivalent of more than $13 billion in export credits and tax cuts, which should benefit Unibanco's business. The stock rallied impressively last week and remains an outstanding buy!

Sorry, but if you want to see the rest of the Buy List, you're going to have to sign up. If you've enjoyed any of my others services, then I encourage you to check out Quantum Growth. I think it's a great vehicle for traders. Plus, if you join now, I'll include this new special report, Unlocking the Quantum Secret: Fast-Track Returns in 2008. So sign up today!

Yesterday, the Federal Reserve released the minutes from its late-April meeting, and as we suspected, the central bank is leaning towards a pause in interest rates. The New York Times reports:

The minutes revealed deep divisions among the bankers, who acknowledged the "difficulty of gauging the appropriate stance of policy in current circumstances."

Those circumstances referred to the dual demons facing the Fed: the broad economic downturn that has depressed spending habits and hurt the job market, and the high costs of oil and food, which have escalated the threat of inflation.

Central bankers projected that prices would rise in 2008 at an annual rate of 3.1 to 3.4 percent, far faster than the year before. At the same time, they predicted that the nation's rate of overall economic growth would significantly slow, to an anemic annual rate of 0.3 to 1.2 percent.

The bankers agreed that inflation would probably taper off in the latter half of the year and fall back to moderate levels in 2009, as businesses found it more difficult to pass on prices to hurting consumers, the minutes said.

In deciding to cut rates at the April meeting, Fed officials noted that "the outlook for growth and employment remained weak." They also agreed that while the economy had not significantly weakened in April, the risk of turmoil in the financial markets remained a problem.

"An additional easing in policy would help to foster moderate growth over time," the minutes said, "without impeding a moderation in inflation."

In the minutes, Fed officials also noted that banks and mortgage lenders had tightened lending standards and "credit conditions were seen as remaining tight." They said that the housing slump appeared far from its nadir and that the problems in that market would continue to weigh on the overall economy.

Last week, stock markets around the world were rattled when a guest on CNBC, Robert Hirsch, predicted that $12 per gallon gas was "inevitable." Furthermore, Mr. Hirsch, who was identified as a Senior Energy Advisor at Management Information Services Inc., said there is no way of stopping surging energy prices. Hirsch said that today's prices will be called "the good old days" in just a few years, when "we'll be paying $12 to $15 per gallon." Then, he said, "we're going to talk about rationing," so that "we're not going to be able to get the fuel when we want it."

I can't subscribe to all of his wild price scenarios, but at the same time I can't see any price relief in sight until after Labor Day, when the U.S. summer driving season ends. After that, oil traders will be watching the Weather Channel to monitor whether or not any hurricanes will be aimed at the Gulf of Mexico. If a major hurricane strikes U.S. refineries, then the price spike that Hirsch and others are talking about could happen.

Regarding short-term supply statistics, the Energy Department reported last Wednesday that crude oil supplies in the U.S. fell by 5.4 million barrels to 320.4 million barrels in the most recent week. That helped contribute to higher crude oil prices. Separately, the American Petroleum Institute reported a fall of 4.1 million barrels in crude supplies during the same week.

Taking a longer view, in the past four weeks, the supply of crude oil in the U.S. actually rose by 12 million barrels, as U.S. demand continues to ebb. According to the Energy Department, crude oil imports averaged 9.2 million barrels per day last week, down 696,000 barrels per day from the 9.9 million barrels per day registered a week earlier. The next big test will be to see if most U.S. consumers will change their driving habits this summer. Virtually all experts are anticipating at least a 1% drop in gasoline demand due to higher prices at the pump. Instead of driving on long vacation trips, families might consider spending their time closer to home--or even AT home.

Hirsch's talk of "peak energy" output is becoming increasingly widespread, especially since many oil executives are starting to endorse the peak oil theory. Last week, many oil executives asked Congress to open up new tracts for exploration, especially in the Gulf of Mexico and in the National Arctic Wildlife Refuge in Alaska. When one oil executive asked Congress to stop blocking oil exploration within the U.S., while also demanding that oil companies reduce gas costs to consumers, Representative Maxine Waters (D-California) threatened to nationalize the oil industry!

Emerging economies are suffering far more than developed economies from high oil prices. Last Thursday, after crude oil rose above $135 for the first time, Taiwan, Malaysia and Indonesia each announced plans to raise prices or cut their subsidies to consumers. In Taiwan, the first act of the newly elected administration of President Ma Ying-jeou was to abolish price controls on petrol and diesel from June 1 forward. Taiwan will also raise electricity prices in July. Malaysia said it would announce a new petroleum subsidy scheme in spite of rising oil prices. Other poor countries, like Indonesia, simply can't afford to keep subsidizing energy costs for their citizens.

Check out the price for fertilizers. Phosphate is up to $1,000 a ton from just $365 last year. The Wall Street Journal reports today:

At a time when food prices are soaring world-wide, so is the price of fertilizer, producing huge profits for leading fertilizer makers and stirring anger among farmers in the U.S. and India.

Fertilizer prices are rising faster than those of almost any other raw material used by farmers. In April, farmers paid 65% more for fertilizer than they did a year earlier, according to the U.S. Department of Agriculture. That compares with price increases of 43% for fuel, 30% for seeds and 3.8% for chemicals such as weedkillers and insecticides over the same period, according to Agriculture Department indexes.

Those skyrocketing costs are making it harder for farmers to expand their harvests in response to the global food crisis that has sparked rioting, rationing and export controls in many countries. Food prices have soared in recent months as the world's growing demand for grain, which has exceeded production for much of this decade, has reduced stockpiles to extremely low levels.

This may be tough news for consumers, but it's excellent news for stocks like Mosiac (MOS) and Potash (POT).