FedEx troubles set off fresh worries over global economy - New York News
by IANS | Updated Sep 17, 2022
The delivery giant's shares lost 21 per cent on Friday, its biggest one-day percentage drop ever, after the company said a macroeconomic slowdown had led to lower volumes of goods moving around the world in recent weeks, The Wall Street Journal reported.
All three major US stock indexes fell Friday, capping a week where the S&P 500 declined 4.8 per cent and the Dow Jones Industrial Average dropped 4.1 per cent.
The chief executives at General Electric Co. and Verizon Communications Inc. also pointed this week to signs of economic troubles, The Wall Street Journal reported.
GE's Larry Culp said managing supply chains remained difficult, threatening to slow deliveries and push up costs; while Verizon's Hans Vestberg said there had been a pickup in customer churn, or cancellations, after a recent price increase.
The world's two biggest economies have been slowing this year.
In the US, the Federal Reserve has been raising interest rates to combat inflation that has been hovering near four-decade highs.
The Gross domestic product, a broad measure of the goods and services produced across the economy, fell 0.9 per cent in the second quarter and 1.6 per cent in the first three months of 2022, Wall Street Journal reported.
China released a raft of economic data on Friday, including figures showing that housing price declines accelerated and consumer spending remained weak.
However, infrastructure investment picked up more quickly than expected, and China's labour market improved.
FedEx and rival United Parcel Service Inc. have confronted lower volumes of packages this year as a pandemic boom in online shopping cools.
Consumers have switched more of their spending to travel and entertainment, plus high inflation has reduced the number of items being purchased.
Big retailers that are FedEx customers like Walmart Inc. have also pulled back on orders after they have been stuck with a glut of unsold goods, The Wall Street Journal reported.
September 17, 2022 Other New York
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