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GLOBAL MARKETS- Stocks near flat but on track for a 3rd week of gains; dollar weakens

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* S&P 500 near flat in early New York trading

* Evergrande averts default with surprise interest payment

* U.S. 10-year yields lower (Updates with early U.S. markets activity, changes byline, dateline, previous LONDON)

By Caroline Valetkevitch

NEW YORK, Oct 22 (Reuters) - Global stock indexes were mostly flat to higher on Friday, with financial shares providing some support to the S&P 500 index in early trading, while the U.S. dollar slipped against a basket of currencies.

MSCI's broadest gauge of global shares and the S&P 500 both were on track for a third straight week of gains.

Investors also digested news that China Evergrande Group appeared to have averted default with a last-minute bond coupon payment, a source said on Friday.

In the foreign exchange market, investors continued to unload long positions that benefited from rising expectations the Federal Reserve will raise rates sooner than previously thought.

"There’s a bit of a positioning unwind taking place. We've obviously seen a firmer dollar since the September," Fed meeting, said Mazen Issa, senior FX strategist at TD Securities in New York. "That also dovetails with the seasonal tendency for the dollar to soften into the end of the month."

The Fed has signalled it could start to taper stimulus as soon as next month, with rate hikes to follow late next year.

The dollar index fell 0.17% to 93.57, and is down from a one-year high of 94.56 last week.

On Wall Street, the financial sector was up 0.9%, while Intel shares fell and were a drag on the market. Late Thursday, Intel reported sales that missed expectations. It also pointed to shortages of chips holding back sales of its flagship processors.

Next week brings reports from several key mega-cap names including Amazon, and bullish investors are hoping they can follow some forecast-beating earnings from others so far this earnings season.

The Dow Jones Industrial Average rose 85.49 points, or 0.24%, to 35,688.57, the S&P 500 lost 0.42 points, or 0.01%, to 4,549.36 and the Nasdaq Composite dropped 72.97 points, or 0.48%, to 15,142.73.

The pan-European STOXX 600 index rose 0.66% and MSCI's gauge of stocks across the globe gained 0.10%.

Data on Friday showed euro zone inflation expectations are at their highest in years, amid a rash of warnings from companies including Nestle, ABB and Unilever .

In the U.S. bond market, yields on longer-dated U.S. Treasuries edged lower.

The yield on 10-year Treasury notes was down 0.5 basis points to 1.670% after rising to a five-month high of 1.7064% late Thursday.

U.S. crude rose 0.57% to $82.97 per barrel and Brent was at $85.08, up 0.56% on the day.

U.S. gold futures gained 1.44% to $1,806.90 an ounce.

Also, bitcoin fell 1.15% to $61,503.91.

(Additional reporting by Simon Jessop in London, and Karen Brettell and Herbert Lash in New York and Kevin Buckland in Tokyo Editing by Hugh Lawson and Mark Potter)

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