Shares of FedEx (NYSE: FDX) (+5%) and UPS (NYSE: UPS) (+4.6%) are higher in early trading Wednesday on reports from the Wall Street Journal that Amazon (NASDAQ: AMZN) is suspending its nascent competing service "Ship with Amazon". The service offered pick-up and shipping of packages in a handful of US and UK cities.

Amazon is suspending the service due to the increased need for people and capacity to handle its own surging demand.

"We regularly look at a variety of factors across Amazon to make sure we're set up in the right way to best serve our customers," an Amazon spokesperson said.

BofA Securities analyst Justin Post said while the news is a positive for UPS and FedEx, it also signals strong demand at Amazon.

"In our view, the suspension of Amazon Shipping is likely a temporary move in unusual times when capacity limits are stretched. AMZN has made similar adjustments recently to support the logistics infrastructure, including: 1) Hiring 100k logistics employees, with 80k already hired; 2) Increasing hourly worker pay by $2/hr (amounting to $350mn+); 3) Only receiving shipment of essential items for 1P inventory & from 3P sellers; 4) Suspending payment on over 20k merchant loans for up to 12 mo.; and, 5) Increasing grocery delivery capacity in the US & int’l."

Post said Amazon Shipping is still a long-term opportunity for the company.