Goldman Sachs: US stock rally comes to an end

The stock market rally is over, says Goldman Sachs, as the S&P 500 index has already exceeded its year-end forecast. The words of the Bank's chief strategist for U.S. equities David Kostin reports Business Insider.

As the expert said in an interview with Bloomberg TV, there is no argument for continued growth in terms of economics, earnings or valuation. He noted that capital flow patterns also show limited upside potential.

Kostin believes that yields will stop rising until the end of the year if the situation does not change. His team forecasts U.S. real GDP growth of just under 3% and earnings growth of about 8%. Current valuations are high and unlikely to spur further growth in equities.

However, Kostin does not rule out a bullish reversal - it is possible if the Fed cuts interest rates significantly. So far Goldman considers two rate cuts as the most likely scenario for this year. The markets have similar forecasts.

Others, like UBS, are more optimistic and believe the S&P 500 could reach 5,500 points if inflation falls and AI spending rises.