Headwinds in the economy may be starting to hit cargo carriers along with their shipping customers. FedEx cut its financial outlook for the year as worker shortages sent labor expenses soaring in the latest quarter and shipping demand unexpectedly slowed due to supply-chain disruptions. The WSJ’s Paul Ziobro reports the delivery giant’s net profit tumbled 11% in the quarter ending Aug. 31 while average daily shipping volume for the Ground and Express segments slipped back. The report marked a rare retrenchment in a parcel sector that has been booming during the pandemic, with e-commerce demand fueling rising shipment counts and higher prices. FedEx has strained to handle volumes that have shifted from its business-to-business strength to home delivery. FedEx says the problems across supply chains have dented demand while tight labor conditions are “driving inefficiencies” in its operations. That’s left customers with slower deliveries and FedEx with thinner margins.

Retailers are growing more confident about the holidays despite steep challenges in their supply chains. Nearly a third of the retailers in the S&P 1500 index have raised their annual guidance heading into the year’s last quarter, the WSJ’s Mark Maurer and Nina Trentmann report, in one sign of why merchants are accelerating efforts to restock their inventories. That rush is hitting disruptions, with Covid-19 outbreaks slowing production at Asian, backups at U.S.-inbound gateways growing and freight rates climbing. But retail sales are rising, and big importers like Macy’s and Dollar Tree have been placing orders earlier. Getting those goods on packed container ships is another matter, and Dollar Tree says it is booking far more capacity than planned on the spot market. Another importer has contracted for bigger volume commitments over the next two years to make sure its stocks are filled this year.

Transportation planners are trying to bridge a gap between forecasts and reality in allocating infrastructure spending. Researchers have found that forecasters have been overly optimistic in projecting the use of roads and highways, the WSJ’s David Harrison reports, pushing millions or billions of dollars into projects that some experts say result in wasted resources. The questions over projections are hanging over debates in Washington as lawmakers consider a $550 billion bipartisan infrastructure bill now before the House. The current plan includes a measure calling for better forecasting models, one result of the concerns that big funding was sent in earlier highway bills toward wasteful pet political projects. One study shows public road projects overestimated use by about 6%. Officials in states including Ohio are putting projections of freight traffic under greater scrutiny, with some officials suggesting money should be going to maintenance rather than creating new capacity.

China’s crackdowns on private enterprises are starting to weigh on business activity and add to financial risks in the country. (WSJ)

Supply-chain visibility provider project44 bought last-mile delivery technology company Convey in a push into the business-to-consumer market. (VentureBeat)

A hedge fund and its finance chief settled allegations that they violated securities rules in trades involving DryShips shares. (WSJ)

The Justice Department is preparing to challenge the American Airlines partnership with JetBlue Airways. (WSJ)

ConocoPhillips is set to become the second-largest oil and gas producer in the contiguous U.S. following its $9.5 billion purchase of Royal Dutch Shell’s Permian Basin assets (WSJ)

Uber is getting closer to reporting its first measure of profitability. (WSJ)

McDonald’s plans to eliminate plastics from its Happy Meals toys by 2025. (WSJ)

British Steel warns an up to 50-fold increase in quoted power prices is cutting into production. (Financial Times)

Average charter rates for the largest dry-bulk ships reached the highest level in Baltic Exchange records dating to 2014. (Lloyd’s List)

Plans to extend gate hours at the ports of Los Angeles and Long Beach face hurdles with truckers, terminal operators and shippers. (Journal of Commerce)

China state-owned Cosco Shipping Ports took a minority stake in the Port of Hamburg’s HHLA Container Terminal Tollerort. (Splash 247)

Beleaguered Japanese shipbuilders are pinning hopes for a rebound on development of zero-emissions vessels. (Nikkei Asia)

Airfreight spot rates out of Asia have jumped to the highest levels this year. (Lloyd’s Loading List)

Truck drivers at Bangladesh’s Chittagong part are staging a 72-hour strike. (The Loadstar)

FedEx will spend over $100 million to reimburse contractors for adding warning sensors and cameras to delivery vehicles to help improve safety. (Bloomberg)

Battery Resources raised $70 million in a funding round backing its efforts to build a closed-loop lithium-ion battery materials supply chain. (TechCrunch)

Pennsylvania-based PLS Logistics Services acquired Overland Park, Kan.-based freight broker D&L Transport. (Business Journals)

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ, and @pdberger. and @LydsOneal. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.