NEW YORK (TheStreet) -- Emerging market stocks were on a roll until May, when fears of a Fed rate hike and its impact on developing countries reversed the trend. Alex Muromcew, portfolio manager for the TIAA-CREF Emerging Markets Equity Fund (TEMRX), said investors should stay positive despite the recent drop in prices.

"I think those fears are overblown," said Muromcew. "I think it will be a gradual, slow interest rate cycle. Some of it is just a natural correction, some profit taking. I'm still optimistic on emerging markets."

Muromcew's Emerging Markets Equity Fund is up just over 1% so far this year, but it has declined nearly 12% in the past 12 months as volatility has taken its toll. A lot of that choppiness has come from the huge run up and recent downturn in Chinese stocks.

"We are watching the Chinese economy. It is slowing. The government is taking measures to mute that and stimulate the economy, so we are still seeing opportunities in China," said Muromcew, adding that he prefers the China H shares, which are denominated in Hong Kong dollars, rather than the A shares that are generally only available for trading by mainland Chinese citizens.

When it comes to sectors in China, Muromcew is a big fan of Internet stocks like Alibaba (BABA), Baidu (BIDU) and Tencent (TCEHY).

"It is such a dynamic sector,"said Muromcew. "You are getting the smartest and most ambitious Chinese who want to work for these companies. You can make a lot of money above board." He added that no single Chinese Internet company dominates a sector, so there is market share to be gained.

Meanwhile, Muromcew is still bullish in the long term on India, even though the stocks have cooled after initially shooting upward as a result of excitement over the reforms of Prime Minister Narendra Modi.

As for Brazil, Muromcew said the country will eventually sort its politics out, but investors need to be patient as corrupt officials are replaced.

"Brazil is a bit of a wild card, unloved and under-owned,"said Muromcew. "We definitely have it on our radar so don't write it off." 

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