(Bloomberg) -- Predictions of a record high for the S&P 500 next year are intensifying, with Deutsche Bank Group AG strategists setting one of Wall Street's most bullish targets yet.

The team led by Binky Chadha expects the benchmark to hit 5,100 points by the end of 2024 - implying gains of about 12% from current levels - against a backdrop of cooling inflation and a rebound in corporate earnings.

"Despite above-trend growth, core inflation has fallen," the strategists wrote in a note. "Continued declines would return inflation to its pre-pandemic range without requiring slower growth." Moreover, given that any recession "is widely anticipated and expected to be mild and short, we see only a modest short-lived selloff."

After broadly failing to predict the equity rally in 2023, market forecasters have turned more optimistic about the outlook for next year as investor sentiment improves and expectations of a recession are dialed back. RBC Capital Markets strategist Lori Calvasina and Bank of America Corp.'s Savita Subramanian both expect the S&P 500 to climb to 5,000 points. The index hit an all-time peak of 4,796.56 in January 2022.

Deutsche Bank's Chadha said he expects corporate earnings to jump 10% in the event of a mild and short recession. However, if gross domestic product were to grow by 2%, the strategist said he sees profits rising 19%. Analysts expect earnings to rise 11% in 2024 after a 0.4% drop this year, according to data compiled by Bloomberg Intelligence.

Chadha was among the few strategists who correctly predicted a rally in the S&P 500 in the first quarter of 2023. The index is also close to his end-2023 target of 4,500 points.