Shanghai: World No.2 Roger Federer suffered a shock 4-6, 6-4, 6-3 defeat by France's Gilles Simon in the Red Group as he began the defence of his Masters Cup title on Monday.
Federer, playing in Shanghai despite suffering from a back injury, began well and won the first set.
But Simon upped his game in the second and came through a tense decider for a thrilling victory.
Simon showed nerves of steel as he served out for the biggest win of his life, finishing Federer off with a serve-volley and an ace.
The top two from Federer's group will go through to the semi-finals, along with two from the Gold Group of Novak Djokovic, Nikolay Davydenko, Juan Martin del Potro and Jo-Wilfried Tsonga.
"Yes it is the only tournament you can still win after losing the first match so that is the only positive thing about the match. Well actually no, because I felt my back was okay. I was quite worried going in to the match to be honest, I didn't practice a whole lot the last week, I have been very, very careful the last nine days doing a lot of treatments so I should be pretty happy the way my back held up so actually more positive now for the next matches," Federer said after the loss.
In the other match Andy Murray at his first Masters Cup got off to a winning start defeating Andy Roddick in three sets.
The British No. 1 came through 6-4, 1-6, 6-1 against the American in the season-ending event for the world's top eight players.
Murray still has round-robin matches to come against Simon and Federer.
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