U.S. Markets closed

EMERGING MARKETS-Global sell-off spreads to Latin America; Mexican peso hits 5-month low

By Aaron Saldanha and Agamoni Ghosh Dec 6 (Reuters) - Latin American stocks and currencies were swept up in a global sell-off on Thursday as weak sentiment prevailed after the arrest of a top executive of Chinese tech giant Huawei sparked fresh concerns about the U.S.-China trade war.

The arrest of Huawei Chief Financial Officer Meng Wanzhou, who is the daughter of the firm's founder, roiled global markets as Washington and Beijing prepare for crucial trade negotiations.

"It's negative for China...if it's negative for China, it's also (negative) for emerging countries," said Fernanda Consorte, an exchange strategist with Brazil-based Ourinvest Bank, noting the potential fallout on exports from Brazil, Latin America's top economy.

MSCI's index of Latin America stocks tumbled 1.9 percent, set for its worst one-day performance in 1-1/2 weeks. Its Latin America currencies index was down 0.6 percent.

Mexico's peso, considered to be a weathervane of trade sentiment, fell half a percent and plumbed a more than five-month low while Brazil's real softened 1.5 percent.

Mexico's peso is likely to bounce back from recent declines but by a smaller amount than previously expected, a Reuters Poll found, underscoring strategists' growing concerns about new President Andrés Manuel López Obrador's management of the country's economy.

Lopez Obrador said on Wednesday he would not cancel contracts issued to foreign and national oil firms by his predecessor but challenged them to pump oil quickly or no further fields would be offered.

A broad-based, 1 percent decline in Brazil's Bovespa index was driven by the energy sector. Global oil prices were hit by the Organisation of the Petroleum Exporting Countries signalling it may agree to a smaller output cut than expected.

State-controlled oil firm Petroleo Brasileiro SA (Petrobras) lost 2.6 percent to lead losses on the Bovespa index , with the firm's preferred and common shares accounting for nearly 300 points of the Bovespa's 954-point drop.

Brazilian antitrust watchdog Cade will begin an investigation on Wednesday that may result in mandatory sales of refineries by Petrobras.

Mining giant Vale SA slid 1.7 percent, hurt by worries over U.S.-China trade, following its basic resources peers in Europe.

Chile's peso started the day with a sharp drop against the dollar aided by a slide in the price of copper - the country's main export.

Key Latin American stock indexes and currencies at 1401 GMT Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 978.42 -2.34 -13.51 MSCI LatAm 2548.65 -1.91 -8.12 Brazil Bovespa 88113.62 -1.04 15.33 Mexico IPC - - - Chile IPSA 5098.64 -0.84 -0.84 Argentina MerVal - - - Colombia IGBC - - Currencies daily % YTD % change change Latest Brazil real 3.9253 -1.47 -15.59 Mexico peso 20.6080 -0.55 -4.41 Chile peso 677.81 -0.81 -9.32 Colombia peso 3184.15 -0.89 -6.35 Peru sol 3.382 -0.15 -4.29 Argentina peso 38.0500 -1.42 -51.12 (interbank) (Reporting by Agamoni Ghosh and Aaron Saldanha in Bengaluru Additional reporting by Claudia Violante Editing by Frances Kerry)