A Bearish Economic Sign From This Bellwether Stock
FedEx, which had already lowered guidance for its fiscal first quarter, is now lowering full-year guidance as part of its earnings release. U.S. GDP for calendar year 2013 has been lowered from 2.4% to 1.9%, and that figure even takes into account extra shipments expected from Microsoft and Apple product launches.
As the country's major shipper, FedEx is widely regarded as a strong bellwether for the American economy as a whole. The logic is that if shipping goes down, it can be assumed that business is going down as well. For a similar reason, Warren Buffett watches the railroad industry as an economic indicator. FedEx is just one company, though, and when it comes down to it, nobody is very good at forecasting the economy -- so take this news with a grain (or boulder) of salt.
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The article A Bearish Economic Sign From This Bellwether Stock originally appeared on Fool.com.Anand Chokkavelu and The Motley Fool own shares of Apple, Berkshire Hathaway, and Microsoft. Motley Fool newsletter services recommend Apple, Berkshire Hathaway, and FedEx. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.