David Kostin, chief US stock strategist at Goldman Sachs Group, said it is unlikely that the S&P 500 will continue to rise between now and the end of this year.

Kostin on Tuesday reiterated his target forecast of 5,200 points for the S&P 500 index at the end of the year, while pointing out that he believes “the return rate will be roughly flat between now and the end of this year.”

This forecast is slightly lower than the current trading level of the S&P 500 after rising 10% since January. Kostin said the bank's model — which incorporates the economy, earnings, valuation and capital flows — shows there is no room for further growth.

Goldman Sachs economists expect the actual GDP growth rate of the US to be around 3% this year. Goldman Sachs stock strategists expect the profit growth rate to reach 8% in 2024. At the same time, they emphasize that the current stock market valuation is already at a historically high level.

“The possibility of multiple expansions is possible, but it's even less likely,” Kostin said.

The US stock market rose on Tuesday, and the S&P 500 recovered most of its April losses and reached another record high. Investors are ignoring the better-than-expected producer price index (PPI) report. They are awaiting key consumer inflation data to be released on Wednesday to find clues about whether the Federal Reserve can cut interest rates later this year.

Kostin said that one of the upside risks facing the outlook is whether officials will be more aggressive in lowering interest rates than the market currently anticipates, but he stressed that this is unlikely to happen at the moment.

“This is not our basic situation,” Kostin said. “Our basic prediction is that as the end of the year approaches, the market's price-earnings ratio will hover around this level, and in fact it will be even lower.”