Why United Parcel Service Stock Is Up Today
Shares of United Parcel Service (NYSE: UPS) sold off last week after archrival FedEx (NYSE: FDX) provided a bleak outlook for the months ahead. On Monday, investors appear to be taking a more nuanced look at what FedEx said, and UPS shares are rebounding as a result. As of 11:33 a.m. ET, shares were up 1.83%.
Investors know the economy appears to be slowing, but there is a lot of debate about how much it is slowing and what that might mean for shipping stocks. FedEx late last week preannounced quarterly results that were well below expectations and cut its guidance for the year, causing shares of UPS to sell off as well.
In theory, there is sound reason to believe that what FedEx is seeing will hit UPS as well. FedEx said that a combination of China's COVID-19 closures, war- and energy-related slowdowns in Europe, and the Federal Reserve's efforts to tame inflation in the United States are combining to slow global volumes. If FedEx is having trouble filling its cargo bays, presumably UPS is feeling the pinch as well.
Source Fool.com
