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EMERGING MARKETS-Latam stocks, FX rise; Argentine stocks scale record high

By Susan Mathew

(Updates prices) By Susan Mathew June 18 (Reuters) - Latin American stocks and currencies surged on Tuesday with a dovish boost from the European Central Bank and positive headlines from the U.S.-China trade tensions boosting sentiment. MSCI's index of Latin American stocks jumped 2%, while its index of regional currencies rose for the first time in four sessions, up 0.7% as regional currencies firmed against a steady dollar. Ahead of a U.S. Federal Reserve policy meeting outcome on Wednesday, when the bank is expected to lay the groundwork for a rate cut, ECB President Mario Draghi hinted at the possibility of new rate cuts. This, along with news that China and the United States are rekindling trade talks after a lull ahead of a meeting between Presidents Donald Trump and Xi Jinping at the G20 summit later this month, buoyed markets globally. Regional assets joined the rally with Brazil stocks rising 1.6% to hit a three-month high. Petrochemical company Braskem cut early losses to trade 4.7% higher. A Brazilian judge on Tuesday granted bankruptcy protection to the company's controlling shareholder Odebrecht, and included Braskem in a list of subsidiaries that creditors are not allowed to sell shares in. The real currency firmed 0.7% ahead of the Brazilian central bank's rate meeting on Wednesday, when it is expected to keep its key lending rate on hold. Returning from a three-day weekend, Argentine stocks rose about 2% and scaled an all-time high before trading 0.8% higher, while the currency rose more than 1%. Mexican stocks rose 0.4%, breaking a three-day losing run. The peso traded steady a day after rating agency Moody's had flagged risks from state oil firm Pemex and unpredictable policymaking by its government. A rise in crude oil prices helped Colombian assets. The oil- exporting country's currency rose almost 1%, while stocks rose 1.7% to an over four-week high, with state oil firm Ecopetrol up 2.3%. Copper-exporting Chile's peso rose after four straight sessions of losses. Copper prices hit three-week highs on Tuesday on trade optimism. Santiago-traded stocks rose 0.1%. Chile President Sebastián Piñera said on Tuesday the government will accelerate a $4 billion infrastructure program this year to revive the country's slow-growing economy. The labor minister, Nicolás Monckeberg, also said the government will push pension reform plans through Congress with "extreme urgency." Key Latin American stock indexes and currencies at 1939 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1025.63 1.45 MSCI LatAm 2788.24 2 Brazil Bovespa 99222.15 1.64 Mexico IPC 43182.32 0.51 Chile IPSA 5,031.79 0.14 Argentina MerVal 40820.48 0.82 Colombia IGBC 12450.09 1.62 Currencies Latest Daily % change Brazil real 3.8598 1.04 Mexico peso 19.1380 0.20 Chile peso 696.2 0.57 Colombia peso 3253.1 0.86 Peru sol 3.332 0.45 Argentina peso 43.4000 1.38 (interbank) (Reporting by Susan Mathew in Bengaluru; editing by Jonathan Oatis)