FedEx shares plummeted to unprecedented lows after the company warned in its outlook report about the closure of offices, freezing hiring, and parking aircraft in response to a decline in package shipping volumes.

FedEx shares were down more than 23 percent at a 2-year-low of $157.40 in morning trading on Friday, putting the company’s stock on track for its biggest one-day drop since listing in 1978.

The warning had an impact on the wider market, with the S&P 500 down 1.5 percent in early trading. Shares of US-listed rival parcel and logistics companies also fell, with UPS down 4.8 percent, Amazon falling 4.1 percent and XPO Logistics sinking 7.4 percent.

FedEx on Thursday evening released preliminary results for the three months to August 31 that were weaker than analysts had expected, blaming “global volume softness” that “accelerated” in the final weeks of the quarter.

The company, which was officially due to report on September 22, said it expected business conditions to further weaken in the second quarter, prompting it to cut its forecast for capital expenditure and withdraw guidance for the remainder of its fiscal year.

The company’s gloomy report is a foreshadowing of what might come on a global economic scale, amid the rising prices and soaring energy costs in nations around the world.

source ft.com