* MSCI LatAm stocks down 1%, FX down 0.6%

* Brazil retail sales beat forecasts in January

* IEA agrees to release 400 mln barrels of oil

(Updates with late afternoon trading)

By Pranav Kashyap and Purvi Agarwal

March 11 (Reuters) - Most Latin American currencies and

stocks fell on Wednesday, as investors assessed the implications

of the Middle East conflict, now in its twelfth day, while also

parsing local economic data.

MSCI's gauge of regional equities slipped 1%

from a one-week high. Its counterpart tracking Latin American

currencies fell 0.6%, retreating from recent

peaks.

Iran's military command said the world should be prepared

for oil to hit $200 a barrel as hostilities continued, in sharp

contrast to Tuesday's de-escalation hopes after U.S. President

Donald Trump predicted the war was nearly over, which fueled a

global relief rally.

The International Energy Agency agreed to release 400

million barrels of oil on Wednesday, the largest such move in

its history, to try to restrain soaring crude oil prices, which

settled more than 4% higher on the day.

Investors remain on edge as the war threatens to choke

global energy trade and trigger a fresh price shock, a risk

world leaders are scrambling to contain.

"As long as the Strait of Hormuz remains all but shut,

tapping IEA emergency oil reserves would only offer a

short-lived remedy," said Elias Haddad, global head of markets

strategy at Brown Brothers Harriman. "It would not take much for

fears to flare up again."

Latin America's commodity-heavy and oil-exporting economies

have held up better than the oil-dependent peers in Asia and

emerging Europe. Still, analysts said a broader flight to

safe-haven assets, coupled with growing concerns about a global

economic slowdown, has started to weigh on the region.

"As long as oil prices stay high, traders will distinguish

between (non-belligerent) oil producers/exporters and oil

importers on the other... To us, Brazil, Colombia and South

Africa are the biggest gainers," said Thierry Wizman, global FX

and rates strategist at Macquarie Group.

Colombia's peso and Brazil's real were both

subdued. Mexico's peso weakened 0.5% against a rising

dollar, driven by safe-haven appeal.

Chile's peso depreciated 0.5%, after clocking its

biggest one-day jump since November 2023 in the previous

session. Local stocks fell 0.9%, partly weighed down

by a dip in copper prices.

Heavyweight Brazilian stocks were muted. Brazil's

retail sales volumes exceeded expectations and returned to the

positive territory in January, government data showed.

Separately, U.S. inflation ticked up in line with estimates

in February, but was overshadowed by the Iran war.

In Buenos Aires, stocks advanced 2.4%. They were

hovering near their highest in two weeks and set for a fourth

straight session of gains - their longest winning streak in more

than a month.

The rally came a day after President Javier Milei sought to

reassure Wall Street that Argentina's economic recovery remains

on course despite market jitters sparked by the war in Iran, and

said the central bank would soon be flush with dollars.

The peso, however, surrendered its early declines

and was last trading 0.3% higher against the dollar.

Although the regional equity and currency indexes have pared

part of their early-year gains, they are still up 14% and 6%,

respectively, so far in 2026 - outperforming the S&P 500,

which remains in the negative territory.

Key Latin American stock indexes and currencies:

Latin American market

prices from Reuters

Equities Latest Daily %

change

MSCI Emerging Markets 1512.59 0.55

MSCI LatAm 3077.88 -0.97

Brazil Bovespa 183371.19 -0.04

Mexico IPC 67377.1 -0.03

Chile IPSA 10506.63 -0.92

Argentina Merval 2764755.3 2.39

1

Colombia COLCAP 2266.03 -0.29

Currencies Latest Daily %

change

Brazil real 5.166 -0.13

Mexico peso 17.676 -0.47

Chile peso 894.87 -0.54

Colombia peso 3698.86 -0.02

Peru sol 3.4212 -0.05

Argentina peso (interbank) 1395 0.29

Argentina peso (parallel) 1395 0.71