*

Latam stocks up 0.1%, FX up 0.15%

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Israel targets Hamas leadership in military strikes on

Qatar

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Mexico's inflation accelerates in August

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US likely created 911,000 fewer jobs in March

(Updates with afternoon trading)

By Pranav Kashyap and Twesha Dikshit

Sept 9 (Reuters) - Latin American currencies were

largely steady on Tuesday amid growing expectations of U.S.

interest rate cuts, while Argentina's peso continued to reel

from the previous day's rout.

Chile's interest rate decision is due later in the day, with

markets expecting the bank to hold rates steady at 4.75%.

However, Monday's cooler inflation data bolstered hopes for

policy easing by the end of this year.

Stocks in Santiago extended declines by falling

1.1%, while the peso rose 0.4%.

Argentine stocks surrendered early gains to fall

0.2% after a pandemic-era-sized selloff on Monday, and the peso

kept trading at new lows, down 0.5%.

Argentine markets crashed on Monday as a bruising 13-point

local election loss for President Javier Milei's party to the

Peronists spurred doubts about the advancement of his austerity

policies.

The defeat in Buenos Aires province paints a gloomy picture

of the president's waning influence in the face of corruption

scandals involving his government officials. Milei now faces a

tough battle ahead in the national midterm elections on October

26.

"We believe the voting in midterms will be different.

There's a higher turnout of voters," said Marco Ruijer, hard

currency portfolio manager at William Blair's emerging markets

debt team.

"It appears that there are a lot of people who do not want

to go back to the Peronists, so probably the gap will not be as

large as now, but the midterm will be an indication of whether

we need to get concerned again," he said.

A gauge tracking Latin American stocks rose

0.1% and a parallel currency index jumped 0.15%.

Mexico's stocks traded at a record high as the

expected acceleration in August annual inflation remained inside

the central bank's target range. The country's currency

rose for a third consecutive day.

Banxico's recent shift to smaller 25-basis-point trims - and

minutes flagging scope for more - kept rate-cut hopes alive.

Markets were also parsing a revision of data indicating the

U.S. economy likely created 911,000 fewer jobs in the 12 months

through March than previously estimated. The revision suggested

hiring stalled even before President Donald Trump's tariff

offensive, fueling expectations of steeper rate cuts.

The Brazilian real slipped 0.25% ahead of Wednesday's

inflation release, with forecasts predicting a 0.15% drop in

August. While the overall data may boost easing hopes but some

sticky components may demand central bank caution.

Brazilian Supreme Court Justice Alexandre de Moraes branded

former President Jair Bolsonaro a criminal group leader who

tried to overturn the 2022 election, as he cast the first vote

in the final phase of the ex-president's trial.

Elsewhere, the Israeli shekel logged its worst day in

over a month, while Tel Aviv's shares closed at a

record as strikes on Hamas leaders in Qatar, marking an

expansion of its military campaign across the Middle East.

Stock indexes Latest Daily % change

MSCI Emerging Markets 1294.45 0.96

MSCI LatAm 2435.36 0.1

Brazil Bovespa 141688.87 -0.07

Mexico IPC 60709.95 0.1

Chile IPSA 8984.97 -1.15

Argentina MerVal 1729800.63 -0.18

Colombia COLCAP 1866.91 -0.23

Currencies Latest Daily % change

Brazil real 5.4327 -0.25

Mexico peso 18.631 0.13

Chile peso 966.23 0.39

Colombia peso 3921.85 0.27

Peru sol 3.4916 0.5

Argentina peso (interbank) 1,416.0 -0.50

Argentina peso (parallel) 1,365.0 1.44