The NY Post reports that Los Angeles Mayor Eric Garcetti is considering instituting a requirement that ride-share service providers use electric vehicles as part of the city's mandate to reduce greenhouse gas emissions and achieve carbon neutral status by 2050. The rule, if enacted, could be a major blow to Uber (NYSE:UBER) since LA is one of its top five markets. The company has already endured a setback in the state when lawmakers passed legislation classifying drivers as employees rather than independent contractors. Last month, it lost its license in London, a market representing ~4% of its business, over its failure to ensure passenger safety.

NBA TV ratings slip 15%

Sports fans are tuning out pro basketball in the U.S., down 15% this season thus far. Through week 8, average viewers on nationally televised games was 885K compared to ~1M a year ago and ~1.2M two years ago. One reason for the diminished enthusiasm is the rash of injuries to star players that have relegated them to the sidelines (Kevin Durant, Stephen Curry, Klay Thompson, Zion Williamson). The bigger issue, though, is the secular shift from cable TV bundles to internet-based alternatives. Lightshed Partners media and telecom analyst Rich Greenfield says, "There is no doubt that the talent in any season can push ratings up or down, but everyone is fighting a very, very difficult underlying trend, which is less people subscribing to TV. And of the people who are subscribing to TV, they're watching less and less every day."

Auto/truck makers scramble to meet stricter emission rules

Auto and light truck industry investors won't have much to cheer about in the near/medium term as more stringent emissions standards take effect in Europe this week (phase-in period extends into 2021), a development long known, though. In order to meet the new rules, manufacturers will have to sell many more hybrid and electric vehicles there or pay costly fines, a situation similar to China, the world's largest car market. The problem for investors is the lack of profitability since manufacturers are stuck between a rock and a hard place; environmentally friendly products will not sell if priced above gas-users but offer little or no margins if priced competitively. The issue will eventually ensnare heavy-duty trucks, albeit with a longer timeline, although new fuel-efficiency rules will be implemented in the U.S. in 2021. In Europe, big trucks will have to emit 30% less greenhouse gases by 2030.

Shale output deficit widening

A WSJ analysis shows that shale wells are not producing as much oil and gas as producers forecasted when they were raising capital. Earlier this year, the WSJ reported that recently drilled wells in the four largest U.S. oil regions are expected to produce 10% less oil and gas over their lifetimes as claimed by fracking companies. Now the gap is closer to 15% per a comparison of productivity forecasts from 29 of the largest shale producers between 2014 and 2017 to estimates from analytics shop Rystad Energy. The potential shortfall represents ~1.4B barrels over 30 years or more than $60B at current prices. Excluding new wells that began producing this year, output in the Permian Basin of Texas and New Mexico would have declined by ~40% according to IHS Markit.

U.S. eyes customs deal with Mexico

Aimed at corralling the inflow of illicit drugs, arms and money into the U.S., the Trump administration is exploring a cooperative agreement with Mexico on customs. Ambassador Christopher Landau and U.S. Attorney General William Barr will travel south of the border next month to discuss a plan.

Today's Markets

In Asia, Japan -0.76%. Hong Kong +0.33%. China +1.16%. India +0.01%.
In Europe, at midday, London -0.20%. Paris -0.18%. Frankfurt -0.49%.
Futures at 6:20, Dow +0.08%. S&P +0.12%. Nasdaq +0.11%. Crude +0.03% to $61.74. Gold -0.15% to $1,515.8. Bitcoin +0.39% to $7,367.2.
Ten-year Treasury Yield +4 bps to 1.91%.

Today's Economic Calendar
8:30 International Trade in Goods
8:30 Retail Inventories (Advance)
8:30 Wholesale Inventories (Advance)
10:00 Pending Home Sales
10:30 Dallas Fed Manufacturing Survey