Emerging market equities and European equities with EM exposure decoupled in 2011, with EM equities underperforming against the market and de-rating steadily, but in the last year the effect of different types of EM exposure have also diverged, pricing in a pessimistic view of EM growth that not everyone thinks is warranted. “EM-exposed ‘cyclicals’ (broadly defined) are now starting to look attractive, with the Price/Book ratio at levels that have historically seen them outperform. They also look to be pricing in a sharp slowdown in emerging market growth, contrary to our economists’ expectations,” write Barclays analysts Dennis Jose, Ian Scott,…