Second quarter results were constrained by continued demand weakness, particularly at FedEx Express. FedEx Express operating income declined 64% year-over-year due to lower global volumes, partially offset by an 8% package yield increase. FedEx Express implemented previously planned and incremental cost reduction actions during the quarter to mitigate the impact of volume declines, including structural air network changes and the temporary parking of aircraft. FedEx Ground operating income increased 24% year-over-year, due primarily to a 13% yield increase and cost reduction actions. These factors were partially offset by increased purchased transportation rates, lower package volume, and higher other operating expenses. FedEx Freight operating income increased 32% year-over-year, driven by an 18% yield increase. This was partially offset by higher salaries and employee benefits and decreased shipments. Second quarter fiscal 2022 net income included a pre-tax, noncash MTM net loss of $260 million ($195 million, net of tax, or $0.73 per diluted share) related to the termination of a TNT Express European pension plan and a curtailment charge related to the U.S. FedEx Freight pension plan.

This week the American Postal workers Union (APWU) launched a national advertising campaign to alert the public about proposed plans to privatize the public Postal Service. The ad called “Memo” highlights a document sent by Wells Fargo Equity Research to investors detailing how proposed plans by the White House to privatize postal services would lead to the closing of local post offices, skyrocketing price hikes to send a letter or package, and an end to the “Universal Service Obligation” where mail is delivered six and sometimes seven times a week to 169 million addresses.

The optimism for the U.S. benchmark came after Baker Hughes BHGE, -1.08% reported that the number of active U.S. rigs drilling for oil was down 4 at 747 last week, breaking a three-week string of rising rig numbers. A drop in rigs implies a slowdown in drilling activity, which is usually boost oil prices. Brent also got a boost from the closure of North Sea Forties pipeline due to a power outage. “The outage of the North Sea’s most important oil and gas pipeline is continuing to lend support,” analysts at Commerzbank said in a note. Click Read More below for additional information.