EMERGING MARKETS-Latam stocks slide, Brazil hit by tax jitters

* Regional indexes bounce off key resistance levels

* Fears of tax on foreign stock buying weigh on Brazil

* Brazil Bovespa off 1.15 pct, Mexico IPC up 0.08 pct
(Recasts, adds comments, updates to close)

By Luciana Lopez

SAO PAULO, April 6 (Reuters) – Latin American stocks fell
on Wednesday, as investors in Brazil feared the government
could raise a tax on foreign investment in equities as part of
its battle to rein in currency gains.

The MSCI Latin American stocks index (.MILA00000PUS: Quote, Profile, Research) lost
0.29 percent, falling off its highest level since June 2008.

Brazilian Finance Minister Guido Mantega called a press
conference for after market close to discuss measures to
control the country’s overvalued currency.

Some investors speculated the government could increase a
tax on foreign purchases of local equities.

“There’s some worry about the measures that Minister
Mantega could announce,” said Newton Rosa, chief economist for
SulAmerica Investimentos in Sao Paulo.

Brazil has been trying to contain gains in the real through
a host of measures, but the currency has continued to gain
ground against the dollar.

Brazil’s benchmark Bovespa stock index (.BVSP: Quote, Profile, Research) shed 1.15
percent to 69.036.91 points after a 6-day rally that added 3.9
percent.

The index broke above the psychologically key 70,000 level,
but pulled back to the 69,000 level that analyst said could act
as support.

“Above 70,000 points we haven’t had a lot of buyers,” said
Otavio Vieira, director of investments at Safdie in Sao Paulo.

The index has struggled to advance this year, with foreign
investors pulling away from emerging market equities.

“What we’ve been seeing is markets in developed countries
performing well compared to emerging economies,” said Guilherme
Sand, a fund manager with Solidus Corretora in Brazil who helps
oversee about 900 million reais in assets.

Shares of mining giant Vale continued to see high-volume
trade after the company this week named a successor to outgoing
chief executive Roger Agnelli. [ID:nN04294281]

The company’s preferred stock (VALE5.SA: Quote, Profile, Research) saw the highest
volume in the index and slipped 0.91 percent.

Mexico’s IPC index (.MXX: Quote, Profile, Research) pulled back from early gains to
close nearly flat, up 0.08 percent.

The index failed to gain past resistance near 38,100
points. If stocks cannot overcome the level in the coming days,
more investors could start to take profits on a nearly 7
percent rally since mid-March, analysts said.

Among rising stocks, shares in Banorte (GFNORTEO.MX: Quote, Profile, Research) added
1.82 percent. Shares in broadcaster Televisa (TLVACPO.MX: Quote, Profile, Research) shed
2.88 percent after media reports that it will buy a 50 percent
stake in mobile operator Grupo Iusacell. [ID:nN06250154]

Chile’s IPSA index (.IPSA: Quote, Profile, Research) rose 0.34 percent to 4781.66
points, gaining ground for the sixth session.

However, stocks pulled back from resistance at 4,800 and
the index’s relative strength index suggested the IPSA could be
overbought, leaving the rally with little steam. The RSI is
used in technical analysis to gauge an asset’s momentum.

A drop of 1.88 percent in retailer Cencosud (CEN.SN: Quote, Profile, Research)
limited gains.

Shares in shipping company Vapores (VAP.SN: Quote, Profile, Research) rose 13.27
percent after Quinenco (QNN.SN: Quote, Profile, Research), the Luksic family’s holding
group, bought a second $120 million stake in Vapores.
[ID:nN06237840]
(Additional reporting by Brad Haynes in Santiago and Michael
O’Boyle in Mexico City; Editing by Diane Craft)

EMERGING MARKETS-Latam stocks slide, Brazil hit by tax jitters