Newark flight delays sparked by air site visitors management failure

People wait in line for a delayed flight at Newark International Airport on May 5, 2025 in Newark, New Jersey.

Spencer Platt | Getty Images

Air traffic controllers lost contact with aircraft heading to and from Newark Liberty International Airport last week, their union said, detailing an equipment failure that led to massive flight delays and raised more concerns about aging U.S. aviation infrastructure and staffing shortages.

The controllers who guide flights in and out of the New Jersey airport on April 28 “temporarily lost radar and communications with the aircraft under their control, unable to see, hear, or talk to them,” the National Air Traffic Controllers Association, their union, said in a statement.

Staffing shortages followed the incident, which was so severe that some of the controllers involved “have taken time off to recover from the stress of multiple recent outages,” the Federal Aviation Administration said on Monday.

There were more than 1,500 delays in the New Jersey airport last week, according to flight-tracker site FlightAware, as disruptions piled up because of shortages of air traffic controllers.

“Our antiquated air traffic control system is affecting our workforce,” the FAA said. “We are working to ensure the current telecommunications equipment is more reliable in the New York area by establishing a more resilient and redundant configuration with the local exchange carriers.”

The FAA and union did not say how long the outage lasted, but Bloomberg reported, citing people familiar with the matter, that it was nearly 90 seconds.

United Airlines said Friday that it will cut 35 flights a day from its New York City area hub at Newark because of the delays, in hopes of putting more slack into the system and ease disruptions.

In a note to customers, CEO Scott Kirby said Friday that last week’s “technology issues were compounded as over 20% of the FAA controllers for EWR walked off the job.”

“This particular air traffic control facility has been chronically understaffed for years and without these controllers, it’s now clear — and the FAA tells us — that Newark airport cannot handle the number of planes that are scheduled to operate there in the weeks and months ahead,” Kirby said in his note.

The union denied that the controllers walked off the job and explained that workers took time off under the Federal Employees Compensation Act, which “covers all federal employees that are physically injured or experience a traumatic event on the job.”

Read more CNBC airline news

The U.S. has faced a shortage of air traffic controllers for years. The Trump administration recently rolled out new incentives to hire and retain controllers, who are required to retire at age 56.

The FAA last year moved controllers who are responsible for aircraft arriving and departing from Newark from a facility on Long Island in New York to a different facility in Philadelphia, in hopes of reducing overloaded controllers who were also handling traffic for New York City’s major airports.

The airspace is some of the most congested in the world.

“The Port Authority has invested billions to modernize Newark Liberty, but those improvements depend on a fully staffed and modern federal air traffic system,” the Port Authority of New York and New Jersey, which oversees the major airports in the New York City area, said in a statement Monday. “We continue to urge the FAA to address ongoing staffing shortages and accelerate long-overdue technology upgrades that continue to cause delays in the nation’s busiest air corridor.”

U.S. Transportation Secretary Sean Duffy last week visited the Philadelphia facility and said he will unveil plans for an “brand new air traffic control system” this week.

“The system that we’re using is not effective to control the traffic that we have today,” he told reporters last week.

Despite the aging technology, Duffy stressed that the system is safe because the FAA will slow, if not ground, airplanes altogether if air traffic controllers have capacity constraints.

New Jersey Gov. Phil Murphy on Monday urged Duffy to address the staffing shortfalls in the Philadelphia facility that oversees Newark as well as the New York facility that controls traffic in and out of LaGuardia Airport and John F. Kennedy International Airport, both in Queens. Of the Philadelphia move and service reductions Murphy wrote: “It is apparent neither effort has led to the desired outcome.”

Murphy asked Duffy to prioritize the region in future investments.

“We expect millions of additional passengers next year as we prepare to host the World Cup Finals and must avoid additional disruptions or strains on the system,” Murphy said in his letter.

Runway construction and bad weather added to Newark travel snarls in recent days.

Index funds faces greatest check in ages from 2025 inventory market

Something unusual is happening in a market long dominated by index funds. Active management is staging a comeback.

Take the action in equity exchange-traded funds two weeks ago. Amid more whipsaw action in stocks that has typified 2025 trading, there was a net outflow from equity ETFs. But in a surprise, the selling was mostly on the index fund side. There were net outflows of $1 billion from equity ETFs in all, but $3 billion in inflows to active equity ETFs to offset the $4 billion of index fund withdrawals, according to ETF Action data.  

Investing experts say actively managed ETFs time in the spotlight marks a transformation that may reshape the ETF space for years to come. A record number of ETFs has launched this year, with 288 new funds and the potential for over 1,000 new ETFs by year-end. In total, there are now more than 2,000 active ETFs, rivaling the total number of index ETFs. While they only make up about 10% of total ETF market assets, they’ve taken over one-third of the flows this year from investors.  

Through the trading week ended April 25, ETFs had taken in $363 billion in flows in 2025, with $132 billion (34%) into actively run funds.

“Actively managed ETFs are taking over the marketplace,” said Jon Maier, JPMorgan Asset Management chief ETF strategist, appearing on last week’s “ETF Edge.”

JPMorgan offers a range of actively managed ETFs, including its popular income ETF JEPI.

There are good reasons for all investors, whether index or active, to use ETFs. Buying and sell stocks offers tax efficiency in the ETF wrapper, they offer all-day trading liquidity, and many ETFs have relatively low expense ratios. More active ETFs are on the way, with a decision from the SEC expected that would allow companies that currently have traditional mutual funds to offer a version of any of those funds as an ETF. 

“There is parity between active and passive now even if the asset bases are very much different,” Maier said, referring to the fact that index funds continue to hold the larger share of total assets ($231 billion in this year’s flows).

After decades during which active stock pickers have often been exposed as “closet indexers” in their funds — in effect buying up what the index holds more than distinguishing their portfolios from benchmarks — it is important for investors to identify funds that are taking a unique approach, and how that approach is structured.

Mike Akins, founding partner of ETF Action, said investors can look at a measure of correlation to the overall market — R-squared — as one way to get a sense for a fund’s “active” nature. Some ETF managers are running what are “active by default” funds with a tilt, a quantitative model unique to their firm which enhances the underlying index performance, but remain closer to the index in overall composition, such as Dimensional Fund Advisors and Advantis ETFs. On the other hand, firms like JPMorgan and T. Rowe Price, from the traditional world of active stock picking and fundamental stock analysis, are doing more “bottoms up” evaluation of stocks and as a result their R2 is “a little lower,” Akins said.

‘Don’t do anything stupid when the market is crazy.’ 

As more money shifts into active, it’s critical for investors to not overreact to short-term swings in the market. Investors may have moved a lot of money earlier in April when the markets fell apart, but as of the end of last week’s trading, stocks had come full circle in a trip that had seen them down as much as 13% in the month. With Friday’s surge capping the longest winning streak for the S&P 500 in two decades, the market had recovered all of its losses since April 2 when President Trump first announced global tariffs, a rebound measured by returns in both the S&P and Nasdaq.

“Don’t trade around when the market panics,” said Bob Pisani, CNBC Senior Markets Correspondent and “ETF Edge” host. “Don’t do panic trading. It’s an old story, for 40 years been saying it, but it really bears repeating. Don’t do anything stupid when the market is crazy.” 

Or, in the words of Vanguard Group founder John Bogle, the index fund pioneer: “Don’t do something … stand there.” 

As investors choose their preferred approach to gaining market access, history says the most important trading strategy is to remain invested, and recent weeks make that point, with 5-7% down days followed by a 10% up day. “If you missed that day, got scared and sold on the 5% down day, it really impacts returns in a long-term portfolio,” Maier said. “Time in the market, not timing the market. Sometimes it is hard and painful, but for investors that have the wherewithal, over the long term you probably will benefit,” he added.

There will continue to be reasons for shift in flows away from blanket index fund exposure as macro trends lead the institutional side of the market to use more active ETFs. Funds like JEPI, which provide income and downside protection, or buffer ETFs that limit the impact of stock volatility on returns while capping upside, are primarily popular with registered investment advisor firms that are buying on behalf of many clients for whom they manage investments. “RIAs are allocating clients to it,” Akins said. “Everyone has agreed for a while that we have had historically high valuations, and the market needed a reset, so people took a little risk off” he added.

Some of that shift has occurred due to the volatility in the bond market, which investors have long relied on for income, but where action in Treasury yields has made advisors and investors anxious about investing in anything but ultra-short term bonds (roughly 60% of all bond ETF flows this year). “They found a different way to allocate fixed income money to similar beta, or up and downs in the market, and capture that side of the market, but in a way that can meet income needs and gain some return from the overall equities market,” Akins said. 

Where battle between index funds and active is headed

The rise of the younger retail investor is also an important part of the active phenomenon.

Robinhood CFO Jason Warnick said on its earnings call last week that the brokerage app saw “incredibly strong engagement across the board,” through the first quarter and in April. “When the market is down, our customers tend to be net buying on the day. A few years ago, folks were worried about what will happen to the retail trader if the market softens? This quarter and the strength of April really helps to answer some of those questions.”

That comes with some outsize active trading risk, though, according to Akins, with the younger generation of “YOLO” investors really leaning into leverage and inverse ETF strategies. With $10 billion in inflows year to date, leveraged and inverse ETFs investing in a single stock like Tesla or Nvidia typify this trend.

“All the evidence says this is not institutional money. Less than 5% of these ETFs are held by institutions based on 13F filings. It is being driven by retail,” Akins said. “On the leverage ETF side, there are just more and more people embracing the stock market and more ‘Robinhood’ traders are willing to do some crazy stuff.”

Maier says there will be more of a gradual move into active ETFs in more traditional asset classes, such as large-cap value and growth, and international, as the ETF structure becomes more accepted.

Akins expects any split in the market to still lean heavily on the side of index funds within traditional investing strategies, with passive funds taking 80%-90% of assets overall. But the trends of the past few years, from the risk-on single-stock funds to the new income and downside protection strategies, will grow.

“We will continue to see the spicy side of the market grow more and more, leverage and inverse. Every weekend, when I sit down to review new launches, I just shake my head on the single stock side. But we will see more innovation on synthetic income and buffered strategies … a continuation of the big themes we’ve been seeing,” he said. 

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White Home Shares Controversial DEI Take On Social Media

The White House took to Instagram with a WILD post that’s got folks raising their eyebrows! On Friday an account representing Trump’s temporary home shared a controversial take on DEI and immigration. The bold message clowned diversity, equity, and inclusion, while celebrating deportations.

The DEI Post That Shook Social Media

The White House’s Instagram page had social media talking on May 2 with a repost of an X post that read, “Deport Every Illegal.” And if that wasn’t enough, the WH declared it’s the only definition of DEI (Diversity, Equity, Inclusion) it is riding behind. The tweet was captioned, “The only DEI we support: Deport Every Illegal.” Whoever runs the White House’s IG page doubled down with a slick, “Yup” for the caption.

Then, in another tweet, the White House continued its attack on DEI, asserting it was “garbage—we lit the match.” Both posts are part of the Trump administration’s ongoing immigration stance.

DEI was garbage—we lit the match.

Men in women’s sports? Delusional—so we shut it down.

This isn’t radical—it’s just common sense. 🔥🇺🇸 pic.twitter.com/t3GFhjQXIi

— The White House (@WhiteHouse) May 2, 2025

The Roomies Respond To The White House Post

Framing their dislike for DEI in such a way has folks side-eyeing the comments hard. People had some STRONG views about the White House sharing not-so-nice thoughts on DEI. For example,  Roomies sounded off in the comments section of TSR’s post. Here’s what some had to say:

@m.garavani wrote, “I’ll never forgive y’all for putting us through this for 4 years.”

@jvaldez71 commented, “Regardless of policies, this is by far the most immature and childish administration in US history. It’s extremely embarrassing to be an American right now.”

@nessie_blaze added, “Somebody reset the game.. blow on the cartridge or somethin cause this is outta control.”

@thepeopleschamp242 wrote, “The most Ghetto uncivilized and unprofessional administration. Like be for real🤷🏿‍♂️”

@kidinfamous asked, “How you worried about illegals when you’re a convicted felon yourself? 😂😂”

@itsofficialqveen expressed, “Whewww the fact the white house making bold statements like this on social media due to his admin is woww”

@msbasketball1 wrote, “This can’t be real!! There’s No way.. The White House social media team just put this out there like this!! This whole country feels like we are on an extended episode of PUNK’D!!!! 😮🥴🤯🤦🏽‍♀️🤦🏽‍♀️🤦🏽‍♀️”

@mikell_je commented, “Let me go become a therapist because the trauma after this presidency gonna be unreal”

Meanwhile, @chefkccardwell wrote, “When the White House page starts looking like Wendy’s, it’s beyond a problem”

The White House Has BEEN Stirring The Pot

The White House is clearly on a mission to keep people’s social media timelines spicy, as this ain’t the first time it has flexed controversial takes. On January 24, just days after Donald Trump‘s inauguration, the White House shared a post showing handcuffed migrants being led into the back of a cargo aircraft. The text at the top of the photo read, “Promises made. Promises KEPT.” Meanwhile, the lower half of the image included the words, “Deportation Flights Have Begun.”

The White House shared some additional words in the caption, writing, “Just as he promised, President Trump is sending a strong message to the world: those who enter the United States illegally will face serious consequences.”

The following month, on Valentine’s Day, the White House posted a pink graphic with President Trump and border czar Tom Homan’s faces, with the text, “Roses are red, violets are blue. Come here illegally, and we’ll deport you.” The caption for the accompanying photo read, “Happy Valentine’s Day.”

And let’s not forget February 19, when the WH celebrated getting rid of New York City’s congestion pricing plan with a post on X, writing, “CONGESTION PRICING IS DEAD. Manhattan, and all of New York, is SAVED. LONG LIVE THE KING!” The account even included a fake Time magazine cover with Trump as a crowned king.

“CONGESTION PRICING IS DEAD. Manhattan, and all of New York, is SAVED. LONG LIVE THE KING!”
–President Donald J. Trump pic.twitter.com/IMr4tq0sMB

— The White House (@WhiteHouse) February 19, 2025

Trump’s Immigration Crackdown Is In Full Effect

In his first 100 days, Trump is said to have made a record-breaking immigration enforcement push, according to a statement released by ICE. The agency says they’ve arrested over 65,000 undocumented immigrants, targeting those who they deem a threat to society.

“The brave men and women of ICE protect our families, friends and neighbors by removing public safety and national security threats from our communities,” said acting Director of U.S. Immigration and Customs Enforcement Todd M. Lyons. “During President Trump’s first 100 days, ICE alone has arrested over 65,000 illegal aliens — including 2,288 gang members from Tren de Aragua, MS-13, 18th Street and other gangs. Additionally, 1,329 were accused or convicted of sex offenses, and 498 were accused or convicted of murder.”

Operation “Tidal Wave” in Florida alone has led to the arrest of over 1,100 people, per FOX Tampa Pay, with help from local law enforcement through the program. Trump has also reportedly tightened worksite enforcement, with ICE fining businesses over $1 million for hiring undocumented workers.

RELATED: Wayment! Did You Peep What Eagles’ Player Elias Ricks Said About Ivanka Trump After His Team’s White House Visit?

What Do You Think Roomies?

It Turns Out That Trump Cannot Defund NPR And PBS

Donald Trump recently signed an executive order stripping the Corporation for Public Broadcasting of $500 million in funding and prohibiting it from getting any future funds, but there is a problem.

The Corporation for Public Broadcasting is not part of the federal government.

Patricia Harrison, President and CEO of the Corporation for Public Broadcasting, said in a statement on Friday:

CPB is not a federal executive agency subject to the President’s authority. Congress directly authorized and funded CPB to be a private nonprofit corporation wholly independent of the federal government.

In creating CPB, Congress expressly forbade ‘any department, agency, officer, or employee of the United States to exercise any direction, supervision, or control over educational television or radio broadcasting, or over [CPB] or any of its grantees or contractors…’ 47 U.S.C. § 398(c).

Trump has as much legal authority to defund NPR and PBS as he does to defund Wendy’s, which is another way of saying that he has none.

Rep. John Larson (D-CT) pointed out that many local NPR and PBS stations depend on federal funding:

CVS Well being (CVS) earnings Q1 2025

CVS Pharmacy logo is seen in Washington DC, United States on July 9, 2024.

Jakub Porzycki | Nurphoto | Getty Images

CVS Health on Thursday reported first-quarter earnings and revenue that topped estimates and hiked its guidance, as its troubled insurance business showed some improvement during the period. 

Shares of CVS closed 4% higher Thursday.

The company now expects full-year adjusted earnings of $6 to $6.20 per share, up from a previous guidance of $5.75 to $6 per share.

But the company revised its GAAP diluted EPS guidance to be lower, which includes charges related to a legal battle involving its pharmacy services provider subsidiary, Omnicare. A jury this week found Omnicare liable for dispensing drugs without valid prescriptions to elderly and disabled individuals in assisted living and long-term care facilities. CVS plans to appeal.

The company did not provide a revenue forecast for the year. CVS said it is “maintaining a cautious view for the remainder of the year” in light of continued higher medical costs and “the potential for macro headwinds.”

“We got smarter about the markets that we wanted and the lives that we wanted to compete for, and so we actually have planned and budgeted for the elevated trends,” CVS CEO David Joyner said in an interview with CNBC, referring to markets that the insurance unit operates in and higher medical costs

“So I think why you’re not seeing a surprise on our part is because we actually plan for elevated trends going into this year,” he added.

Joyner said the company is watching for the potential impact from President Donald Trump’s planned tariffs on pharmaceuticals imported into the U.S.

“On the pharmacy side, I think it is highly dependent on what happens in the next week or two when they announce the implications of tariffs on the manufacturers,” he told CNBC. Joyner added that the vast majority of the company’s retail products at the front of stores are sourced in the U.S., “which should be a benefit for us.”

Here’s what CVS reported for the first quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG: 

  • Earnings per share: $2.25 per share adjusted vs. $1.70 per share expected
  • Revenue: $94.59 billion vs. $93.64 billion expected

The company’s insurer, Aetna, and its rivals have been dogged by higher-than-expected medical costs over the last year as more Medicare Advantage patients return to hospitals for procedures they delayed during the pandemic. But for the first time in several quarters, CVS’ insurance business appeared to show some signs of improvement.

The unit’s medical benefit ratio — a measure of total medical expenses paid relative to premiums collected — decreased to 87.3% from 90.4% a year earlier. A lower ratio typically indicates that a company collected more in premiums than it paid out in benefits, resulting in higher profitability.

CVS said the move partly reflects stronger underlying performance in its Medicare business and improved Medicare Advantage star ratings for the 2025 payment year. Those ratings help patients compare the quality of Medicare health and drug plans.

“I think that investment and talent that allowed us to focus on both the execution and the operation … actually helped establish the performance that you’re seeing,” Joyner said, referring to an executive reshuffling last year that tapped a new leader for the insurance unit and other parts of the business.

The results cap off the second full quarter with Joyner, a longtime CVS executive, as chief executive of the retail drugstore chain. Joyner succeeded Karen Lynch in mid-October, as CVS struggled to drive higher profits and improve its stock performance.

The company underwent a management reshuffle as part of a broader turnaround plan that includes $2 billion in cost cuts over the next several years.

Still, CVS’ performance was partially offset by a charge of $431 million from so-called premium deficiency reserves in the insurance unit, which is related to anticipated losses in the 2025 coverage year. That refers to a liability that an insurer may need to cover if future premiums are not enough to pay for anticipated claims and expenses.

The company posted net income of $1.78 billion, or $1.41 per share, for the first quarter. That compares with net income of $1.12 billion, or 88 cents per share, for the year-earlier period. 

Excluding certain items, such as amortization of intangible assets, restructuring charges and capital losses, adjusted earnings were $2.25 per share for the quarter.

CVS booked sales of $94.59 billion for the first quarter, up 7% from the same period a year ago due to growth across all three of its business segments. 

But sales in the company’s retail pharmacy segment missed Wall Street’s expectations for the quarter, according to StreetAccount. That business has been pressured by softer consumer spending and lower reimbursements for prescription drugs. 

Strength across business units

CVS’ insurance business booked $34.81 billion in revenue during the quarter, up 8% from the first quarter of 2024. Analysts expected the unit to take in $33.51 billion for the period, according to estimates from StreetAccount.

The unit also recorded adjusted operating income of $1.99 billion for the first quarter, compared with $732 million for the year-earlier period. 

Also on Thursday, CVS said Aetna will stop offering health insurance plans on the Affordable Care Act marketplaces — also known as individual exchanges — starting in the 2026 plan year.

More CNBC health coverage

CVS’ pharmacy and consumer wellness division booked $31.91 billion in sales for the first quarter, up more than 11% from the same period a year earlier.

But that was far under the $35.27 billion that analysts were expecting for the quarter, according to StreetAccount.

That unit dispenses prescriptions in CVS’ more than 9,000 retail pharmacies and provides other pharmacy services, such as vaccinations and diagnostic testing.

CVS’ health services segment generated $43.46 billion in revenue for the quarter, up nearly 8% compared with the same quarter in 2024. Analysts expected the unit to post $43.64 billion in sales for the period, according to StreetAccount.

That unit includes Caremark, one of the nation’s largest pharmacy benefit managers. Caremark negotiates drug discounts with manufacturers on behalf of insurance plans and creates lists of medications, or formularies, that are covered by insurance and reimburses pharmacies for prescriptions.

Don’t miss these insights from CNBC PRO

Trump tariffs on China imply ‘irreversible’ harm for a lot of companies

Container vessels and shipping containers at Yangshan Deep-Water Port on Oct. 18, 2024, in Shanghai, China.

Vcg | Visual China Group | Getty Images

Apple’s iPhone and other technology hardware, from chips to PCs, received a China tariff reprieve from President Trump on Saturday, but for much of the U.S. economy and small business owners, the damage will soon be irreversible from the 145% tariffs being imposed on Chinese imports.

Canceled freight orders and abandoned freight from China are quickly becoming the norm in the trade war between the U.S. and China, according to supply chain executives, as businesses across U.S. industries put a full stop on container exports, with the tariffs hitting like a ton of bricks.

“Furniture producers in China have seen a complete halt in orders from U.S. importers, and we’re hearing the same across toys, apparel, footwear, and sports equipment,” said Alan Murphy, founder and CEO of Sea-Intelligence.

“We had the same across Southeast Asia, but after the 90-day reprieve those bookings have restarted,” said Brian Bourke, chief commercial officer for SEKO Logistics, while the cancelled bookings for containers out of China continue. 

“Almost everything is on hold as it relates to China business,” said Alan Baer, CEO of OL USA.

“Trump’s 145% total tariff on Chinese imports would stop most trade between the U.S. and China,” economist Erica York, vice president of federal tax policy at the Tax Foundation’s Center for Federal Tax Policy, said on Thursday on CNBC’s “The Exchange.”

“There may still be some things without any substitutes that companies just have to foot the bill, but for the most part, that cuts it off,” York said.

As it became clear over the last week that China would remain the main target of the Trump administration’s tariffs policy — after the 90-day reprieve was granted to all other countries expected to be hit with new tariffs — the message that came through is that lower-margin goods cannot sustainably be produced in China. The new exemption for technology can be partially explained by the how the supply chain works, but also reinforces where the greatest pain will be felt.

“Higher-margin and more technical goods, such as electronics, machinery, medical equipment, and pharmaceuticals cannot easily move sourcing, as setting up highly technical manufacturing takes time and considerable capital,” Murphy said.

Before the tech tariff exemption, he says producers of these goods were analyzing what components could be sourced elsewhere, while primarily looking to draw down U.S. inventories in the short term. There is a concerted effort to move production to South East Asia, primarily Vietnam, or India. Lowering prices to Europe to keep production going, or outright closing down production lines, were also being considered.

‘Not a risk or burden small business can sustain’

Stephen Lamar, CEO of the American Apparel & Footwear Association, said the sudden policy changes and high tariffs are disrupting supply chains at a level not seen since the pandemic.

“With prohibitively high tariff levels on U.S. imports from China, many companies have no choice but to cancel orders,” said Lamar. “The constant switchbacking means new tariff costs are not accurately presented or predictable until the goods arrive at the port, and the high rates are generating bills that can’t be paid. That is not a risk or burden small business can sustain.”

Lamar said with no alternative sourcing on the horizon for many of these companies, particularly small businesses, this sudden lack of orders will immediately translate into lost sales and widespread product shortages. “An extension of the trade war pause to U.S. imports from China is needed now before the damage is irreversible,” Lamar said.

Murphy warned that on the container liner side of the freight business, the drop in bookings coupled with the possibility of shipbuilding fees on “Chinese” vessels also going into effect next week, will result in a “massive restructuring of all liner services to North America.”

“And it will take months to sort out the mess, with congestion and freight rate spikes for months to come,” he added.

Murphy said across all of the Chinese-based producers his firm has spoken with, none are currently actively looking to move production to the U.S., with part of the reason being lack of understanding about the administration’s ultimate aims.

“The biggest concern here is a complete uncertainty of the actual end-game of the Trump administration,” he said. “No one will consider massive investments in U.S. production if tariffs are merely a ploy to negotiate better trade deals. If the administration is actually pursuing a goal of U.S. reindustrialization, then the long-term plan for tariffs has to be clear, and less talk of ‘4D chess’ and ‘Art of the Deal,'” he said. “The Yo-yo tactic of changing tariff rates on a daily basis does nothing but create uncertainty,” he added.

Holding on freight processing is one way of mitigating the impact of tariffs. Logistics providers can offer bonded storage, which allows freight to come into the U.S. without being charged a tariff for a certain amount of time. Use of foreign trade zones and other methods of delaying transits allow for the temporary deferral of trade duties.

“The current circumstances are unprecedented,” said Karsten Kildahl, chief commercial officer at A.P. Moller-Maersk.

Abandoned freight

The fate of abandoned ocean and air freight — cargo that isn’t claimed or paid for by the shipping company or the freight forwarder responsible for paying customs on behalf of their client — isn’t clear and rules change port to port, and contract to contract.

Port officials tell CNBC they are not typically notified of abandoned cargo. The New York Terminal Conference Agreement states that cargo remaining on the terminal in excess of 30 days will be considered as abandoned and sold for collection of demurrage charges due to the NYTC — charges assessed for leaving freight at terminals for an excessive period of time. It also says the ultimate responsibility of the costs usually depends on specific shipping contracts. “If the BL (Bill of Lading) hasn’t been transferred to the consignee, it is the shipper’s responsibility. The shipper could decide to take the cargo back (i.e. re-export the cargo), destroy or donate it.”

Shippers usually prepare a “letter of abandonment” for U.S. Customs purposes for the cargo to be sold or auctioned, with proceeds from the sale/auction paying any expenses, such as use of container and chassis, and with the balance for the terminal. 

The terminal can move abandoned cargo to a bonded warehouse or leave it on the terminal and sell it from there. There is a market for buying abandoned freight. Companies such as JS Cargo & Freight Disposal, FR8 Auctions or Merchandise USA buy abandoned cargo and then sell it in discount stores, outlets, liquidators, online sellers like Amazon, drug chains, variety outlets, redemption centers, liquidators, and closeout buyers.

Maersk tells CNBC many shippers are deploying a “wait and see”-approach and in a recent alert to clients wrote that until there is a clearer picture, customers will be cautious about their inventory levels and continue exploring ways to build additional flexibility into their supply chains. Across its global network of warehouses, distribution centers, port terminals, vessels, and cargo planes, “extra flexibility” is what many clients are seeking now, Kildahl said.

Correction: Alan Murphy, founder and CEO of Sea-Intelligence, warned that on the container liner side of the freight business, a “massive restructuring of all liner services to North America” should be expected. An earlier version of this article misidentified the source of the comment.

BP posts sharp fall in first-quarter revenue on weaker oil costs

British oil and gasoline company BP (British Petroleum) signage is being pictured in Warsaw, Poland, on July 29, 2024.

Nurphoto | Nurphoto | Getty Images

British oil giant BP on Tuesday posted slightly weaker-than-expected first-quarter net profit, following a recent strategic reset and a slump in crude prices.

The beleaguered oil and gas major posted underlying replacement cost profit, used as a proxy for net profit, of $1.38 billion for the first three months of the year. That missed analyst expectations of $1.6 billion, according to an LSEG-compiled consensus.

BP’s net profit had hit $2.7 billion a year earlier and $1.2 billion in the final three months of 2024.

The results come as the energy major faces fresh pressure from activist investors less than two months after announcing a strategic reset.

Seeking to rebuild investor confidence after a protracted period of underperformance relative to its industry peers, BP in February pledged to slash renewable spending and boost annual expenditure on its core business of oil and gas.

BP CEO Murray Auchincloss told CNBC’s “Squawk Box Europe” on Tuesday that the firm was off to a “great start” in delivering on its strategic reset.

“We had a great operational quarter. We had our highest upstream operating efficiency in history. Our refineries in the first quarter ran at the best they’ve run in 24 years. We had six exploration discoveries in a row, which is really unusual and we started out three major projects,” Auchincloss said.

For the first quarter, BP announced a dividend per ordinary share of 8 cents and a share buyback of $750 million.

Net debt rose to $26.97 billion in the January-March period, up from $22.99 billion at the end of the fourth quarter.

BP had previously warned of lower reported upstream production and higher net debt in the first quarter, when compared to the final three months of last year.

Activist pressure

The green strategy U-turn does not appear to have gone far enough for the likes of activist investor Elliott Management, which went public last week with a stake of more than 5% in the London-listed firm.

The disclosure makes the U.S. hedge fund BP’s second-largest shareholder after BlackRock, the world’s largest asset manager, according to LSEG data.

Elliott was first reported to have assumed a position in the oil and gas company back in February, driving a share price rally amid expectations that its involvement could pressure BP to shift gears back toward its oil and gas businesses.

Murray Auchincloss, chief executive officer of BP, during the “CERAWeek by S&P Global” conference in Houston, Texas, on March 11, 2025.

Bloomberg | Bloomberg | Getty Images

BP’s Auchincloss declined to comment on interactions with investors when asked whether the firm was under pressure from the likes of Elliott to go beyond the plans announced in its February pivot.

Notably, BP suffered a shareholder rebellion at its annual general meeting earlier this month. Almost a quarter (24.3%) of investors voted against the re-election of outgoing Chair Helge Lund, a symbolic result that reflected a sense of deep frustration among the firm’s shareholders.

Mark van Baal, founder of Dutch activist investor Follow This, told CNBC last week that he hoped the shareholder revolt means Amanda Blanc, who is leading the process to find Lund’s successor, will look for a new chair who is “climate competent” and “will not respond to short-term activists so quickly.”

Lund is expected to step down from his role next year.

Takeover candidate

BP’s underperformance relative to industry peers such as Exxon Mobil, Chevron and Shell has thrust the energy major into the spotlight as a prime takeover candidate. Energy analysts have questioned, however, whether any of the likeliest suitors will rise to the occasion.

BP’s Auchincloss on Tuesday said that he wouldn’t speculate on whether the company is a takeover target, but confirmed the oil major had not asked for any sort of protection from the British government.

“What I will say is we’re a strong, independent company and we’ve got sector-leading growth. And if we can deliver the sector-leading growth, and the first quarter is a fantastic example of that, then I have no concerns. I think we’re going to do great,” Auchincloss said.

Oil prices have fallen in recent months on demand fears. International benchmark Brent crude futures with June delivery traded at $65.19 per barrel on Tuesday morning, down more than 1% for the session. That’s lower from around $84 per barrel a year ago.

Asked whether weaker crude prices could put the some of the firm’s reset plans in jeopardy, Auchincloss said, “Not really. We have a balance of products that we think about that generate revenue for us. So, oil, natural gas and refined products as well.”

— CNBC’s Ruxandra Iordache contributed to this report.

No Trump-Xi tariff talks underway, China says

U.S. President Donald Trump answers reporters’ questions after exiting Marine One at the White House in Washington, D.C., U.S., April 27, 2025.

Ken Cedeno | Reuters

China on Monday once again denied that it is in talks to resolve its tariff war with the United States, after a series of statements by President Donald Trump and his aides suggesting trade negotiations were underway.

“Let me make it clear one more time that China and the U.S. are not engaged in any consultation or negotiation on tariffs,” Chinese Foreign Ministry spokesman Guo Jiakun said at a press conference.

Guo also appeared to reject Trump’s claim, in an interview with TIME last week, that Chinese President Xi Jinping had called him.

“As far as I know, there have not been any calls between the two presidents recently,” the spokesman said.

The latest blanket denial was in line with Beijing’s hardline stance against Trump’s massive 145% tariffs on imports from China, a top supplier of U.S. goods.

Trump administration officials, including Treasury Secretary Scott Bessent, insist that the U.S. is better positioned to win a trade war than China is.

But American business owners and analysts are raising alarms that the effective trade embargo with China could soon result in major economic consequences, including higher prices, product shortages and store closures.

Read more CNBC politics coverage

Against that backdrop — and Trump’s recent claim that his administration will be finished crafting new trade deals with numerous countries in as little as three or four weeks — some U.S. officials have expressed more openness toward a dialogue with Beijing.

“Every day we are in conversation with China,” Trump’s Secretary of Agriculture, Brooke Rollins, said Sunday on CNN.

When told that the Chinese deny this, Rollins said, “Well, according to our team in Washington, the conversations are ongoing regarding multiples of trade, multiples of the trade goods that are coming out and going in.”

“The bottom line with China is this, they need us more than we need them,” she said.

Asked on Sunday why China would deny that negotiations are underway, Bessent said, “Well, I think they’re playing to a different audience.”

Pressed to explain whether the talks are actually happening, he said, “We have a process in place. And again, I just believe these Chinese tariffs are unsustainable.”

Bessent predicted last week that a “de-escalation” with China was coming in the “very near future.”

On Monday morning, he pointed to that prospective de-escalation to help explain why he was not yet concerned that U.S. consumers could soon face empty store shelves.

“Not at present,” Bessent said on Fox News, when asked if he was concerned about “empty shelves.”

“We have some great retailers. I assume they pre-ordered. I think we’ll see some elasticities and I think we’ll see replacements, and then we will see how quickly the Chinese want to de-escalate,” said Bessent.

In a separate interview Monday morning on CNBC’s “Squawk Box,” Bessent put the onus for that de-escalation on China, before saying he would not negotiate through the press.

China has consistently demanded that Trump, who has held up tariffs as both a powerful negotiating tool and way to rake in government revenue, scrap his sweeping import taxes.

“If the U.S. really wants to resolve the problem … it should cancel all the unilateral measures on China,” a spokesman for the Chinese Ministry of Commerce said last week.

That statement, translated from Mandarin by CNBC, was itself a response to Trump’s claim on Thursday that U.S. and Chinese officials “had a meeting this morning.”

“We’ve been meeting with China,” Trump told reporters, while declining to specify who was meeting whom.

A day earlier, Trump said that U.S. officials were “actively” talking with China.

Novo Nordisk authorized win bars many compounded Wegovy, Ozempic medication

Flags with the logos of Danish drugmaker Novo Nordisk, maker of the blockbuster diabetes and weight-loss treatments Ozempic and Wegovy are pictures while the company presents the annual report at Novo Nordisk in Bagsvaerd, Denmark, on February 5, 2025. 

Mads Claus Rasmussen | Afp | Getty Images

Novo Nordisk scored a huge legal victory that largely restricts compounding pharmacies from marketing or selling cheaper, unapproved versions of the drugmaker’s blockbuster weight loss drug Wegovy and diabetes treatment Ozempic. 

A federal judge in Texas late Thursday rejected a bid by compounding pharmacies to keep making copies of Ozempic and Wegovy while a legal challenge over the shortage of those drugs unfolds. That came in response to a February lawsuit from a compounding trade group against the Food and Drug Administration’s determination that the active ingredient in those drugs, semaglutide, is no longer in shortage in the U.S.

Patients flocked to the cheaper copycats when Ozempic and Wegovy were in short supply over the last two years due to skyrocketing demand, or if they didn’t have insurance coverage for the costly treatments. 

During FDA-declared shortages, pharmacists can legally make compounded versions of brand-name medications. Many telehealth companies, such as Hims & Hers, also offered those copycats. But drugmakers and some health experts have pushed back against the practice because the FDA does not approve compounded drugs, which are essentially custom-made copies prescribed by a doctor to meet a specific patient’s needs. 

“We are pleased the court has rejected the compounders’ attempts to undermine FDA’s data-based decision that the shortage” of semaglutide is resolved, said Steve Benz, Novo Nordisk’s corporate vice president, legal and U.S. general counsel, in a statement. 

“Patient safety remains a top priority for Novo Nordisk and the extensive nationwide legal actions we have taken to protect Americans from the health risks posed by illegitimate ‘semaglutide’ drugs are working,” he said, referring to the company’s more than 100 lawsuits against compounding pharmacies and other entities across 32 states. 

On Thursday, U.S. District Judge Mark Pittman specifically denied the Outsourcing Facilities Association’s bid for a preliminary injunction that would have prevented the FDA from taking action against its members for making copies of semaglutide. 

That decision upholds the FDA’s previous determination that the semaglutide shortage in the U.S. is over and means the FDA can now immediately go after so-called 503A pharmacies that are making compounded versions of semaglutide according to individual prescriptions for a specific patient.

Those pharmacies are largely regulated by states rather than the FDA.

The decision also means the FDA can start targeting federally regulated 503B pharmacies, which manufacture compounded drugs in bulk with or without prescriptions, after May 22. The agency’s actions can include product seizures and warning letters to pharmacies. 

More CNBC health coverage

The decision on Thursday follows another win for Novo Nordisk. A different federal judge in Texas earlier this week ruled in favor of the drugmaker against a 503A pharmacy, MediOak Pharmacy, permanently prohibiting the business from marketing or selling compounded semaglutide.

Novo Nordisk and Eli Lilly have aggressively cracked down on compounding pharmacies over the last two years as they benefit from the soaring popularity of their weight loss and diabetes drugs.

Eli Lilly has gone through a similar legal process with tirzepatide, the active ingredient in its weight loss drug Zepbound and diabetes treatment Mounjaro. The FDA declared the U.S. shortage of tirzepatide over last year, prompting the same compounding trade group to sue the FDA over the drug. 

In March, a federal judge denied the compounding group’s request for a preliminary injunction on the FDA’s enforcement against its members for making copies of Mounjaro and Zepbound. The compounding group has appealed.

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