Nvidia drags Wall Street down as United Airlines says it's impossible to predict this year's economy

NEW YORK — Nvidia is dragging Wall Street down on Wednesday after it said new restrictions on exports to China will chisel billions of dollars off its results, while companies around the world say President Donald Trump's trade war is making it nearly impossible to forecast how the economy will do this year.

The S&P 500 was 1.2% lower in morning trading and erasing its gain from earlier in the week. The Dow Jones Industrial Average was down 244 points, or 0.6%, as of 10:10 a.m. Eastern time, and the slide for Nvidia and other stocks in the chip industry sent the Nasdaq composite down a market-leading 2%.

Nvidia was the heaviest weight on the market and dropped 5.9% after it said the U.S. government is restricting exports of its H20 chips to China, citing worries that they could be used to build a supercomputer. The restrictions could mean a $5.5 billion hit to Nvidia's results for the first quarter, covering charges related to inventory and purchase commitments.

China and the United States, the world's two largest economies, have been locked in a trade war and raising tariffs and other impediments to trade with each other. But these restrictions on exports for chips used in artificial-intelligence technology are getting more support from both U.S. political parties, not just Trump's.

Sen. Elizabeth Warren, a Democrat, asked the U.S. Commerce Department earlier this week ''to immediately move forward with restrictions on the export of Nvidia's H20 and other advanced AI chips'' to China, saying they could help enhance its military and surveillance operations.

Rival chip company Advanced Micro Devices and other companies in the industry also fell sharply Wednesday, with AMD dropping 5.9%.

In Amsterdam, ASML's stock sank 6.7%. The Dutch company, whose machinery makes chips, said demand for AI is continuing to drive growth. ''However, the recent tariff announcements have increased uncertainty in the macro environment and the situation will remain dynamic for a while,'' CEO Christophe Fouquet said. ASML gave a forecast for revenue in the upcoming quarter that fell short of analysts' expectations.

United's stock rose 0.7% after it also reported a stronger profit for the latest quarter than analysts expected and said bookings for premium cabins and for international flights are growing.

Many investors along Wall Street are bracing for a possible recession because of Trump's tariffs, which he has said he hopes will bring manufacturing jobs back to the United States and trim how much more it exports to other countries than it imports. A survey of global fund managers by Bank of America found expectations for recession are at the fourth-highest level in the last 20 years.

The World Trade Organization said Wednesday it expects tariffs to result in a 0.2% decline in the volume of world merchandise trade for 2025. That's if the tariff situation remains as it was on Monday. Trade could shrink by 1.5% this year if conditions worsen, the WTO said.

The ''enduring uncertainty threatens to act as a brake on global growth, with severe negative consequences for the world, the most vulnerable economies in particular,'' Director-General Ngozi Okonjo-Iweala said.

Tariffs could also drive up inflation, at least temporarily, by pushing U.S. importers to pass along the higher costs to their customers.

Economists said much of that was likely because U.S. shoppers were rushing to buy automobiles, electronics and other items whose prices may rise ultimately sharply because of tariffs.

Recent surveys have shown U.S. households are feeling much more pessimistic about the economy because of tariffs, and a fear is that it could lead them to pull back eventually on their spending, which could cause a recession by itself.

Treasury yields bit in the bond market following the report on retail sales. The yield on the 10-year Treasury fell to 4.33% from 4.35% late Tuesday.

In stock markets abroad, indexes fell across much of Europe and Asia.

The FTSE 100 dipped 0.4% in London after the government said inflation in the U.K. fell for the second month running in March, largely as a result of lower gas prices.

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