Good morning,

Markets are lower this morning after Japan unexpectedly sank into a recession last quarter as the world’s third-largest economy struggled to shake off the impact of an April sales-tax boost, raising the odds of a delay in a second bump in the levy. Gross domestic product shrank an annualized 1.6% in the three months through September, a second straight drop matching the textbook definition of a recession. Unadjusted for price changes, the economy contracted an annualized 3%.

In the G20 meeting this weekend, President Vladimir Putin weathered a barrage of criticism from world leaders at a summit in Australia, repeatedly facing them down with the same line – Russian troops are not operating in Ukraine. Leaving the Group of 20 summit in Brisbane early to get some sleep on the flight home before Monday meetings, Putin was unrepentant in his mantra that it’s the leadership in Ukraine’s capital Kiev that needs talking to. European foreign ministers meeting today in Brussels will discuss expanding the list of individuals targeted as part of sanctions on Russia.

Group of 20 leaders agreed to take measures that would boost their economies by a collective $2 trillion by 2018 as they battle patchy growth and the threat of a European recession. Citing risks from financial markets and geopolitical tensions, the leaders said the global economy is being held back by lackluster demand. The group submitted almost 1,000 individual policy changes designed to lift growth and said they would hold each other to account to ensure they are implemented.

The price of oil resumed its decline after the biggest gain in almost two months as investors weighed the likelihood that OPEC will cut output when the group meets this month. Oil has declined about 30 percent from a June peak as leading OPEC members resisted calls to cut output and instead reduced some export prices while U.S. production climbed to the highest level in more than three decades. Venezuela, Libya and Ecuador have asked for action to support crude as the 12-member group prepares to meet in Vienna.

On a more positive note, Investors piled into Shanghai shares on the first day of exchange-link trading, buying the maximum amount allowed in a sign of global demand for mainland equities as China opens up its $4.2 trillion market. International investors purchased 13 billion yuan ($2.1 billion) of Shanghai shares by 1:57 p.m., triggering a halt in buy orders for the rest of the day. Mainland investors used about 1.7 billion yuan of their 10.5 billion yuan quota in Hong Kong. Trading through the link is running smoothly, according to brokerages including First Shanghai Financial Holding Ltd. and Emperor Securities Ltd.

Draghi, who has faced opposition to his most-recent measures, addresses the European Parliament in Brussels today. He’ll probably reiterate his pledge to be ready with further steps should the outlook for the economy worsen, and he’ll act on that promise either this year or in 2015. The majority of economists believe that Mario Draghi will succeed in boosting the European Central Bank’s balance sheet back toward €3 trillion, though he’ll have to override some policy makers’ qualms on quantitative easing to do so.

In corporate news, Halliburton Co. and Baker Hughes Inc. have resumed negotiations about a potential merger of the world’s second-and third-largest oil-field service companies. The two companies restarted talks yesterday, after initial discussions fell apart late last week triggering a stalemate that lasted through Nov. 15, the person said. An announcement could come in the next few days, according to the person, who asked not to be identified as the details are private.

Good day and happy trading!

Kristian Camenzuli