Yesterday, the Federal Reserve upped interest rates by another quarter of a percent, a move interpreted as a signal of continued strength within our economy. Today, FedEx (NYSE:FDX), a company many watch for other indications of economic health, said that its first-quarter earnings soared.

Earnings at FedEx, a Motley Fool Stock Advisor pick, more than doubled to $330 million, or $1.08 per share, as the company said the global economy is expanding. Revenues increased 23% to $6.98 billion, with increases across all business segments. Its relatively new initiative, FedEx Kinko's, added $490 million to sales for the quarter.

Overall average daily volume growth increased 6%, although overseas potential is one of the things investors are counting on. Indeed, according to its conference call (transcript courtesy of Thomson StreetEvents), average daily volume growth was 21% in Asia, with China -- a coveted market for many businesses -- representing 52% of that growth. "The global economy is expanding steadily, particularly the manufacturing and industrial sectors, giving our business and, more important, our customers' business more opportunities to grow," management said in the call.

However, another major theme is how FedEx Kinko's is going to figure into things. Of course, there are no year-over-year comparisons, seeing how Kinko's was still operating as an independent entity this time last year, before FedEx snapped it up for $2.4 billion.

FedEx said that the first quarter is seasonably weaker for FedEx Kinko's (read, summer doldrums) and that margins have been negatively impacted by that fact and costs associated with rolling out new product offerings. These costs are expected to continue through the remainder of fiscal 2005.

And, of course, FedEx still faces competition in the form of UPS (NYSE:UPS) and DHL, as well as the U.S. Postal Service (which is also a customer).

FedEx shares have generated tons of excitement over recent months, given the company has served up increased earnings guidance several times over the course of recent months. Some investors seem a little spooked today, though it might have been a case of buyer's remorse for some. After all, FedEx shares have continually trekked upward over the last year, powered by excitement over continued upward guidance, international adventures, and FedEx Kinko's.

Maybe investors are a little spoiled, what with headier days of upward guidance, which they missed today. (Even though it was as recently as Aug. 23 when it last provided an upbeat glimpse.) It doesn't seem there's much cause to be fed up with FedEx just yet.

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Alyce Lomax does not own shares of any of the companies mentioned.