Marriott International has agreed to acquire Starwood Hotels & Resorts Worldwide (NYSE:HOT) in a deal valued at about $12.2B, creating the world's largest hotel company. Under terms of the deal, Starwood shareholders will receive 0.92 shares of Marriott (NASDAQ:MAR) Class A stock and $2 in cash for each share of Starwood common stock. Combined, the companies operate more than 5,500 hotels with 1.1M rooms worldwide, with pro forma fee revenue for the 12 months ended September 30, 2015 totaling over $2.7B. MAR +0.4%; HOT -1.8% premarket.

Economy

Markets across the globe are still processing the weekend's coordinated terrorist attacks in Paris that left at least 132 people dead and more than 350 wounded. The events sent Asian bourses lower overnight, while U.S. futures inched higher, erasing earlier losses as they tracked moves in Europe. Among the biggest casualties in the financial markets is the euro, which shed 0.5% to $1.0710, as investors scrambled for safe-havens like the U.S. dollar and gold. The attacks are also likely to hit France's economy, which has the largest number of tourists in the world. The sector accounts for almost 7.5% of the country's GDP.

As a result of the attacks, French fighter jets launched their biggest raids in Syria to date, targeting the Islamic State's stronghold in Raqqa (crude futures +1.7% following the bombing). The strikes came hours after France declared a "state of emergency" and pledged to step up its campaign with the U.S. against ISIS. Other issues that will have to be sorted out include Europe's migrant crisis, recruitment of extra security personnel and the expansion of intelligence-sharing.

Meanwhile, world leaders are wrapping up their two-day summit in the Turkish resort town of Antalya. While the conference has traditionally been a forum dedicated to economic discussion, this year's meeting was dominated by the crisis in Syria and fight against Islamic State in the wake of the attacks. What else was discussed? Global growth, infrastructure investment, tax cooperation and climate change. The G20 also looked set to endorse plans to end the era of "too big to fail banks," forcing them to raise as much as $1.2T in capital cushions.

Takeaways from Saturday's Syria talks in Vienna: The 17-nation deal resulted in a timeline that will help opposition groups draft a constitution and elect a new government by 2017. However, the agreement left many key issues hanging, such as the fate of President Bashar al-Assad and a decision on which of the hundreds of opposition groups will be included in the political process. It also doesn't specify whether the new government would have full executive power and hinges on whether the president will commit to a process that will end his regime.

Japan's economy slid back into recession in the third quarter, marking the latest setback for Prime Minister Shinzo Abe and his "Abenomics" policies. With consumer spending still soft and businesses cutting back on investment, gross domestic product shrank at an annualized rate of 0.8%, putting policymakers under pressure to deploy more stimulus measures. The GDP figure follows a revised 0.7% contraction in April-June, which was the first decline in three quarters.

IMF staff on Friday officially recommended the renminbi be included in its Special Drawing Rights basket, but Japan is still warning China to go slow on yuan reform. "The pace of capital outflows is alarming," a senior official with knowledge of Japan's currency diplomacy told Reuters. "If China's financial system is destabilized, the effect on Japan and the rest of Asia would be enormous." An IMF move would be the first change in the SDR's currency composition since 2001, when the euro replaced the German mark and French franc.

For the first time in at least a decade, imports fell in both September and October at the three busiest seaports in the U.S., according to the WSJ. The three - Los Angeles, Long Beach, and New York harbor - handle more than half of the goods coming into the country, and saw imports fall just over 10% between August and October. The decline occurred during what's typically known as peak shipping season and is especially troubling to some economists, but others say it's more likely to do with a sizable inventory build-up earlier this year.

S&P 500 earnings are on track to close their first season of negative growth since 2009, with more than 90% of components having already reported results. Thomson Reuters data suggests this will occur again in Q4, predicting a bigger 2.4% contraction and setting up for a bona fide 'earnings recession' (two consecutive periods of declines). According to FactSet, this already occurred in the second and third quarters. All this comes as the Fed prepares to hike rates for the first time in almost a decade - a move that could weaken corporate earnings even further.

Stocks

Seeing some serious headwinds ahead, Caterpillar (NYSE:CAT) is warning that it doesn't expect Chinese demand for excavators to return to the highs hit several years ago. "That shows how far off the peak we are," Caterpillar's Tom Pellette told the FT. "For China specifically, our expectation is that the market will rebound but we are not planning [for it to] get back to 2011/2012 levels." The remarks are significant as the group is often dubbed a global bellwether, with its sales giving investors insights into the state of economies worldwide.

Ericsson has quashed a recent media report that claimed Cisco (NASDAQ:CSCO) was seeking to buy the Swedish networking giant, stating there haven't been any merger talks. "We note that there are rumors in the market regarding an acquisition of Ericsson by Cisco possibly spurred by the recent announcement of a partnership between our two companies," said CEO Hans Vestberg. Cisco shot down the report shortly after it surfaced on Friday. ERIC +1.7% premarket.

China's Tsinghua Unigroup is planning to invest 300B yuan ($47B) over the next five years to build the world's third-largest chipmaker and confirmed it was in talks with a U.S.-based company about a deal that could be finalized by the end of November. The state-owned tech firm declined to give more details of the transaction but said buying a majority stake was unlikely as it was too "sensitive" for the U.S. government. Over the last few months, Tsinghua prepped a $23B bid to acquire DRAM/NAND flash giant Micron (NASDAQ:MU) and took a 15% stake in Western Digital (NASDAQ:WDC). MU +0.6% premarket.

The race to buy General Electric's Japanese commercial-lending operation is nearing the finish line with two bidders remaining, sources told WSJ. The leasing arm of Sumitomo Mitsui Financial Group (NYSE:SMFG) and Shinsei Bank (OTCPK:SKLKY) submitted binding bids earlier this month and both will continue discussions for the business valued at nearly $5B. Media reports on Friday said GE was set to enter into exclusive talks with SMFG.

The number of oil wells in North Dakota that have been drilled but not fracked surpassed 1,000 for the first time in September, as producers wait for prices to recover before turning them on. As a result, more than 8% of oil wells in North Dakota are now sitting idle, harming the industry's ability to grow production; daily output in the state fell 2% in September to about 1.16M bbl/day. The backlog is "sending a definite signal to the market that oil and gas operators are not willing to do a lot of drilling or hydraulic fracturing or production at these low prices," said Lynn Helms, director of the state's Department of Mineral Resources. Related tickers: CLR, HES, EOG, WLL, XOM, OAS, NOG, EOX, MRO

Hasbro stockholders will be focusing on the company's Investor Day this morning, which will see CEO Brian Goldner and CFO Deborah Thomas outline the firm's efforts and upcoming plans. Shares of Hasbro (NASDAQ:HAS) have risen over 40% in the last year, lifted in part by sales of Star Wars toys that have helped it gain ground on its larger rival, Mattel (NASDAQ:MAT).

Facebook board member Marc Andreessen is padding his wallet ahead of the holiday shopping season, selling over 1.5M shares of his Facebook (NASDAQ:FB) stock in the past two weeks at a value of roughly $160M. Since Oct. 30, Andreessen has offloaded more than 73% of his total ownership in the company, and 90% of his class A shares. The sale is pretty noteworthy, as it's uncommon for executives to sell at this kind of pace and quantity.

The European Central Bank has found capital gaps totaling €1.74B ($1.9B) among nine lenders that it tested, with the biggest hole at Portugal's Novo Banco. "Banks will be required to address remaining shortfalls in a timely manner by issuing capital instruments or undertaking other eligible measures," the ECB said in a statement. Other participating banks: Banque Degroof, Agence Française de Développement, JPMorgan (NYSE:JPM) Bank Luxembourg, Mediterranean Bank, Sberbank (OTCPK:SBRCY) Europe, VTB Bank (Austria), UniCredit (OTC:UNCFY) Banka Slovenija and Kuntarahoitus Oyj.

Things are also getting ugly in New York for daily fantasy sports. Industry leaders DraftKings and FanDuel have both filed lawsuits against NY Attorney General Eric Schneiderman, who recently classified their businesses as illegal gambling under state law. The companies have long argued that daily fantasy is a game of skill and should therefore be legal, but regulators aren't as convinced. Nevada ordered the shutdown of daily fantasy sports operations (without a license) in October, and more states may follow suit.

Today's Markets

In Asia, Japan -1% to 19394. Hong Kong -1.8% to 21994. China +0.7% to 3607. India +0.6% to 25760.
In Europe, at midday, London +0.1%. Paris flat. Frankfurt +0.2%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.1%. Crude +1.7% to $41.42. Gold +1% to $1091.90.
Ten-year Treasury Yield -1 bps to 2.26%

Today's Economic Calendar

8:30 Empire State Mfg Survey