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EMERGING MARKETS-Brazil stocks extend slide, airline Gol rises

* Brazil Bovespa down 0.92 pct, Mexico IPC flat

SAO PAULO, Nov 25 (Reuters) - Brazilian stocks dropped for

the third session in four on Monday as investors, eyeing a

deteriorating fiscal outlook and higher interest rates in Latin

America's largest economy, remained bearish on local shares.

Mexico's IPC index and Chile's bourse were

both little changed.

Brazil's benchmark Bovespa stock index fell 0.92

percent to 52,316.16, adding to a more-than 14 percent drop for

the year. The Bovespa looks set to post its first monthly loss

in five in November, having dropped 3.5 percent since the

government announced a far worse-than-expected September budget

deficit on Oct. 31.

"We're not tracking the gains in markets abroad because

things here are looking quite complicated, with the outlook for

a worsening fiscal situation and higher interest rates," said

Alvaro Bandeira, a partner with Orama Investimentos in Rio de


All but two of 62 economists polled by Reuters expect

Brazilian policymakers to raise the benchmark Selic rate

by 50 basis points to 10 percent on Wednesday, its

highest since March 2012.

Itaú Unibanco Holding SA, Brazil's largest

non-government bank, fell 2.9 percent, contributing most to the

index's losses, while mining firm Vale SA lost 1.2


Shares of airline Gol Linhas Aereas SA jumped 3

percent after the company said that a measure of ticket prices

known as yield rose 14 percent in October from a year earlier

while executives forecast a stable outlook for domestic flights

next year.

Mexico's IPC index was little changed from Friday's

close, with a 0.7 percent rise in shares of telecommunications

firm America Movil offsetting a 0.7 percent fall in

retail giant Wal-Mart de Mexico.

Chile's IPSA index was also near unchanged, with

shares of Latam Airlines rising 1.5 percent and

regional energy group Endesa Chile down 0.9 percent.

Latin America's key stock indexes at 1537 GMT:

Stock indexes daily % YTD %

Latest change change

MSCI LatAm 3,294.79 -0.5 -12.81

Brazil Bovespa 52,316.16 -0.92 -14.17

Mexico IPC 41,219.26 0.05 -5.69

Chile IPSA 3,738.36 0.08 -13.09

Chile IGPA 18,437.99 0.07 -12.49

Argentina MerVal 5,529.54 2.49 93.73

Colombia IGBC 13,338.16 -0.09 -9.36

Peru IGRA 15,108.81 0.08 -26.76

Venezuela IBC 2,455,587.9 3.82 420.87