NEW YORK (CNNMoney.com) -- Delivery giant FedEx Corp. boosted its earnings forecast for the current quarter and full year Monday. The company cited increased demand for its express and ground services as the global economy continues to recover.
FedEx said it expects to earn between $1.05 and $1.25 per share for the first quarter ending Aug. 31, up from its previous guidance of 85 cents to $1.05 per share. Analysts surveyed by Thomson Reuters were expecting a profit of $1.01 per share.
For the full year, the Memphis, Tenn.-based company said it should rake in between $4.60 and $5.20 per share, above earlier targets of $4.40 to $5.00 per share. The latest projection is roughly in line with analyst expectations.
Shares of FedEx (FDX, Fortune 500) surged to close 5.6% higher on the news. The stock of rival UPS (UPS, Fortune 500) also rose, climbing 1.9%.
FedEx said its new forecast reflects the current outlook for fuel prices and a continued recovery in the worldwide economy.
"Our revenue and earnings growth are exceeding original expectations, primarily due to better-than-expected growth in FedEx Express and FedEx Ground volumes," said Alan Graf, FedEx chief financial officer.
Graf said there has been especially strong demand for its higher margin international priority package and freight services. Volumes are expected to surge 20% during the current quarter.
The company said it included the cost of restoring the company match for 401(k) plans beginning in 2011 in the earnings outlook.
FedEx's first quarter results will be released Sept. 16. 
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