U.S. Market Storm Stayed Below Surface: Jullier

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Oct. 17 (Bloomberg) -- Antonin Jullier, global head of equity trading strategy at Citigroup, talks with Francine Lacqua about how markets reacted to the U.S. government shutdown and threat of default. He speaks on Bloomberg Television’s “On The Move.”

The markets were right not to panic.

Yep.

Usually, a push it through and that is what we got.

What has been interesting is not looking at the index levels.

They were going into it.

He was still within spitting distance.

The biggest story is on the side of the market.

We did see pressure in october, november, december.

That has moved to march.

On the equity side, we saw protection.

We saw the sku.

We saw the money protection.

So, we want to deleverage as well.

It is pretty quiet for two weeks.

Keep that thought.

We will have a round up of the markets.

The u.s. has been quiet.

We're talking about some of the moves that we saw in the t- bills.

The consensus was that we get a deal and we got a deal.

Anticipate or's -- investors anticipated that.

Much of the concern was a race in a number of hours.

Equity markets have been desensitized to much of the action in d.c.. one of the reasons you are seeing a relief rally is because of that.

The other reason is that the u.s. is take the can down the road and doesn't set the tone for what is coming down in washington.

This will have an impact.

The question is, however so is this -- how reversible is this?

We approach a big quarter and we will find out that we may not see the full impact of this for months.

This may be in the rearview mirror right now.

Republicans will regroup and refocus.

The focus will be on government spending.

We could be in for some pretty strong fiscal headwinds next year.

We were talking about the markets.

He was telling me that we can take a deep rest and we had the debt ceiling.

We have to focus on the earnings season.

It has been interesting.

On the west side, expectations are high.

And the levels are back 52%. the markets have done the work of lowering expectations.

So far it is 70/30. their small positive sales that are not as good.

The worry is that they will not be around for guidance in 2014. july is not unusual.

We have seen that for the last few use -- years.

Allow the companies we been looking at come out with earnings and it is growth and impact the way that they see the future.

Is this going to be the kind of the focus for next year ? it is all pointing towards emerging markets and what is interesting is the reaction we saw in the emerging markets.

We were trading for next year.

If you look at companies in developed markets, they demand rich valuations.

Both in the u.s. and europe?

You are trading at 16.5 times.

These are the same companies that have 30% valuation gaps.

We pay a lot of attention.

Are you going to get a convergence/ > --convergence?

They are undervalued, am i wrong?

I'm not thinking that he is necessarily.

Right.

Yeah.

The equity could drive this farther.

There's another way to get exposure very cheap.

It could be expensive to the cheaper one.

What is your favorite play in terms of putting equities?

Do you wait for the earnings season or can you put a play right now?

I can put a play on the u.k. on the valuation side, grossing city outperforming into next year -- growth seems to be outperforming.

I think we are one of the highest once.

Two or three percent.

There's an interesting currency angle where it is short.

The performance on the ftse -- we can see renewed interest in the pound.

The uk's very low in chief.

-- and cheap.

Ok.

This text has been automatically generated. It may not be 100% accurate.

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