The S&P 500 will slump to a new a low early next year, offering US stock investors a chance to hop in and benefit, according to Morgan Stanley's top stock picker.

"You're going to make a new low sometime in the first quarter, and that will be a terrific buying opportunity," the bank's CIO Mike Wilson said in an interview with CNBC.

"Because by the time we get to the end of next year, we'll be looking at 2024, when the earnings will actually be accelerating again," he added.

Wilson made an S&P 500 price call of 3,900 for the end of 2023, adding that US stocks face volatile times ahead as they get near the end of the current bear market. 

"I think we're in the final stages. But the final stages can be very challenging, right?" he said.

Inflation, soaring interest rates, and a looming US recession have weighed down on investor appetite for stocks this year, and the benchmark stock index is nearly 17% lower year-to-date. 

The S&P 500 dipped into bear market territory in June, as the Federal Reserve hit the brakes on the US economy with harsh interest rate hikes. The central bank is trying to tame the 40-year high inflation, triggered in part due to Russia's war with Ukraine, from becoming entrenched. 

The Fed in 2022 has hiked the fed funds rate from 0% to a range of 4.25%-4.5%, including four consecutive, hefty hikes of 0.75 percentage points. Inflation cooled down somewhat in October, but the monthly headline rate of 7.1% through November exceeds the Fed's 2% target. 

"Now it's a more of a two-way risk. And I think we're going to be in that two-way risk probably until the year end," Wilson added, said the first 7-8 months of the year was a "straight down move." 

"The final move of the bear market probably comes next year in the first quarter, when the earnings finally catch up to where we think they're going to be next year," he said.

Wilson said earnings expectations for next year are 20% too high, but suggested that volatility, rather than a hit to stock prices, is in focus for Morgan Stanley.

"As bearish as we are next year on earnings, the price damage probably isn't that bad over the next 12 months, it's the path that's going to be really tricky," he said.