SINGAPORE, July 8 (Reuters) - Goldman Sachs ( GS ) has raised

its three-, six- and 12-month S&P 500 return forecasts, citing

expectations of earlier and deeper U.S. interest rate cuts and

continued fundamental strength of the largest stocks as reasons

for the optimism.

The brokerage said in a note late on Monday that its new

three- and 12-month returns forecasts are +3% and +11%

respectively, indicating S&P 500 levels of 6,400 and 6,900.

Its six-month return forecast, which corresponds with the

year-end, has risen to +6%, indicating a level of 6,600, from

6,100 earlier.