Morgan Stanley believes that the pullback in emerging market stocks may have created a fairly attractive entry point for the market from year-end through 2027.

Strategists Jonathan Garner, Daniel Blake, and Ji Jing wrote in a research note that the MSCI Emerging Markets Index has fallen about 12% from its recent high, a decline slightly smaller than the 14% drop in March and the 13% drop in July; current emerging market valuations are below the levels seen at the previous two lows.

They said: "We have not yet turned bullish, but we believe this round of pullback has been sufficient."

The market has already priced in a great deal of skepticism about whether the current earnings cycle can continue, but uncertainty still remains, including the outcome of the U.S. midterm elections and the situation in the Middle East.