(Updates to late afternoon)

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US stocks mixed and Dow up

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Gold down sharply as investors take profits

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Trump-Xi meeting next week

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Traders hope for US-China trade resolution

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Nikkei extends record rally

By Caroline Valetkevitch

NEW YORK, Oct 21 (Reuters) - Major stock indexes were

mostly near flat on Tuesday, with upbeat results and forecasts

from top U.S. companies providing some support, while the yen

fell to a one-week low after conservative Sanae Takaichi was

elected as Japan's prime minister.

Earlier, Japan's Nikkei share gauge closed at a record

high.

Gold prices were on track for the steepest daily fall in

five years as investors took profits after recent sharp gains.

Spot gold was last down 5.8% at $4,102.60 an ounce.

U.S. President Donald Trump said he expected to reach a fair

trade deal with Chinese President Xi Jinping when the two meet

next week in South Korea, and played down the risks of a clash

over the issue of Taiwan.

The prospect of a resolution also helped bolster investor

sentiment, along with a deal between Australia and the United

States for the supply of rare earth materials.

In earnings, GM shares jumped after the company

raised its full-year forecast, and Coca-Cola gained after

the company posted results that beat analysts' estimates.

But the S&P 500 technology sector was down 0.2%,

and Michael Green, chief strategist at Simplify Asset Management

in Philadelphia, said reaction to some earnings surprises was

modest.

"The earnings are better than expected as companies continue

to gain slightly in terms of margins, which suggests that

(companies) have to be passing through the tariffs or pushing

the tariffs back onto the importers," Green said.

The Dow Jones Industrial Average rose 218.16 points,

or 0.47%, to 46,924.74, the S&P 500 rose 0.22 points,

essentially flat, to 6,735.35 and the Nasdaq Composite

fell 36.88 points, or 0.16%, to 22,953.67.

MSCI's gauge of stocks across the globe fell

1.00 points, or 0.10%, to 994.69. The pan-European STOXX 600

index rose 0.21%.

Against the Japanese yen, the dollar strengthened

0.81% to 151.96.

Takaichi, the first female PM and leader of Japan's ruling

Liberal Democratic Party, won the lower house vote on Tuesday to

choose the next prime minister. Traders bet that Takaichi's

government could muddy the interest rate outlook and bring about

greater fiscal spending.

The dollar also rose against other currencies. The dollar

index, which measures the greenback against a basket of

currencies including the yen and the euro, rose 0.35% to 98.95,

with the euro down 0.33% at $1.1602.

U.S. Treasury yields eased as investors looked ahead to the

Federal Reserve's next moves.

The Fed could deliver as many as three rate cuts in the next

six months, based on market-based expectations, while the ECB,

which meets next week, is not expected to deliver a rate cut any

time soon.

The yield on benchmark U.S. 10-year notes fell

2.9 basis points to 3.959%, from 3.988% late on Monday.

Investor confidence was hit hard last week as a clutch of bad

loans at U.S. regional banks ignited concern over credit risks

that threatened to spill into the broader markets. The prolonged

U.S. government shutdown also weighed on risk assets.

Oil prices ended higher. Brent crude futures rose 31

cents, or 0.5%, to settle at $61.32 a barrel, while U.S. West

Texas Intermediate crude futures for November delivery,

which expired on Tuesday's settlement, closed up 30 cents, or

0.5%, at $57.82.