CNBC Daily Open: Turbulence in economy forces United Airlines to offer 2 earnings forecasts

Airplanes are one of the few modes of transport that get you from your place of origin to your destination in a mostly straight line. But United Airlines, one of the biggest carriers in the U.S., doesn't have the luxury of a direct route when it comes to predicting its finances. The airline on Tuesday offered two full-year earnings estimates: One is its original stemming from January; the other, a newly revised forecast if there is a recession.

On the one hand, it's an acknowledgement that it's impossible to predict the economy — think about how many analysts were certain a recession would strike the U.S. in 2023. On the other, it's uncommon for companies to do so, reflecting the heightened volatility in the economy because of U.S. President Donald Trump's administration.

In markets, however, volatility seems to be subsiding for now, according to the CBOE Volatility Index, or the VIX, which is seen as Wall Street's "fear gauge." Stocks retreated Tuesday, but they were marginal drops compared with the huge plunges the last week. The journey now, then, is relatively smoother, but as United Airlines' unusual move suggests, turbulence could still be ahead.

China's economy heats up
China's economy expanded by 5.4% in the first quarter, according to data from National Statistics Bureau on Wednesday, higher than the 5.1% growth expected in a Reuters poll. Better-than-expected retail sales and industrial output boosted China's economy. The former rose by 5.9% year on year in March, sharply beating analysts' estimates for a 4.2% growth, while industrial output expanded by 7.7% from a year earlier, higher than median estimates of 5.8%.

New appointee for China's top trade job
On Wednesday, China appointed Li Chenggang as vice minister of commerce and as a top representative for international trade negotiation, according to an official statement. That makes Li a key personnel as Beijing confronts a growing trade war with the U.S., in which talks or concessions have yet to occur. Li replaces Wang Shouwen, who previously occupied both roles.

Nvidia to take $5.5 billion charge
Nvidia shares fell around 6% in extended trading after the company said Tuesday that it will take a quarterly charge of about $5.5 billion tied to exporting H20 graphics processing units to China and other destinations. On April 9, the U.S. government told Nvidia it would require a license to export the chips to China and a handful of other countries, the company said in a filing. The H20 is an AI chip for China that was designed to comply with U.S. export restrictions.

Volatility in U.S. markets retreats
U.S. stocks slipped Tuesday. The S&P 500 dropped 0.17%, the Dow Jones Industrial Average lost 0.38% and the Nasdaq Composite was down a marginal 0.05%. The VIX fell to about 30 after hitting a high of around 60 last week. Asia-Pacific markets fell Wednesday. Hong Kong's Hang Seng Index lost more than 2.3%, leading losses in the region. Declines of over 4% in Chinese tech giants like Meituan, Alibaba and Kuaishou Technology dragged down the index.

Earnings estimates in a recession
United Airlines reported earnings on Tuesday, and took an unusual step of offering two earnings outlooks. The company left intact expectations issued in January, but also provided earnings estimates in the event of a recession. "The Company's outlook is dependent on the macro environment which the Company believes is impossible to predict this year with any degree of confidence," it said in a securities filing.

[PRO] U.S. retail report could be deceptive
The U.S. retail sales report, out Wednesday, should look solid as consumers are still spending money. Economists are also expecting a healthy growth reading. The details, though, likely will tell a different story. Here's why investors should not be taken in by the headline number, wrote CNBC's Jeff Cox.

Tokyo has ‘many cards’ to play in U.S. tariff negotiations, says Japanese economic advisor

Japan has "many cards" to play in tariff negotiations with the United States, according to Takeshi Niinami, senior economic advisor to Japan's prime minister.

Niinami pointed out that Japan has been the biggest foreign investor in the U.S. and the largest foreign holder of U.S. Treasury bonds. Japan should therefore talk about more opportunities to invest in the United States, and will keep its massive stock of U.S. Treasurys, he said, adding "We know that the President is [very concerned] over the bond market," referring to U.S. President Donald Trump.

His comments comes ahead of a three-day trip by top negotiator Ryosei Akazawa to the U.S. for talks with U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer.