(Nov 29): After a bruising 2018, emerging markets will probably be the place to make quick money next year.

It’s not even December, but major Wall Street investment banks have already issued their outlooks for 2019, and the mood is hopeful. Morgan Stanley went outright bullish, double-upgrading the asset class to overweight from underweight. Goldman Sachs Group Inc, meanwhile, said “there will likely be a good number of tradable rallies” even if 2019 turns out to be another painful year.

Underpinning their calls is a sharp expected slowdown in US earnings. Morgan Stanley strategist Jonathan Garner estimates growth will slump to 4% from 23% this year. While earnings increases in emerging markets will accelerate only modestly, to 7% from 3%, there’s no longer a glaring differential.

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