FedEx (FDX) made an express delivery of disappointment to the markets this morning, but the transportation exchange traded fund (ETF) is holding steady in early trading.

The company said that falling demand and rising oil and gas prices are going to weigh on their fiscal 2009 profits, reports Tim Paradis for the Associated Press. FedEx is 13.9% of the iShares Dow Jones US Transportation Average (IYT), which was up slightly. Year-to-date, it’s up 12.8%.

The financial sector’s woes continued as well, only adding fuel to the suspicion that we’re not quite out of the woods:

• Fifth Third Bancorp (FITB) said it planned to cut its dividend by almost two-thirds, raise $1 billion through an offering of preferred stock and generate another billion through the sale of businesses.
• MF Global Ltd. (MF) said tight credit spreads would weigh on its fiscal first quarter earnings.
• Morgan Stanley (MS) announced stronger-than-expected second-quarter earnings, but they fell 61% from a year earlier.

Financial ETFs continued to head lower today:

• iShares Dow Jones US Broker-Dealers (IAI): Morgan Stanley is 7.3%; MF is 3.7%; down 25.4% year-to-date.
• Financial Select Sector SPDR (XLF): Morgan Stanley is 2.5%; down 21% year-to-date.

For full disclosure, some of Tom Lydon’s clients own shares of IYT.

Tags: Financial, Sector ETFs, Transportation