SAO PAULO, July 6 (Reuters) - Brazil's stocks and currency slipped on Thursday on lingering concerns over a political crisis, but shares of power utilities rallied due to a planned regulatory overhaul of the sector. Demand for Brazilian assets has fizzled in recent months as traders feared a corruption scandal could delay the implementation of President Michel Temer's ambitious agenda, which is seen as critical to fuel long-term economic growth. The Brazilian real weakened 0.4 percent, the biggest decliner among Latin American currencies, which were mostly flat. The Colombian peso, however, strengthened 0.3 percent, tracking rising crude oil futures. Brazil's benchmark Bovespa stock index fell 0.7 percent, weighed down by blue-chips such as lender Itaú Unibanco Holding SA and beverage producer Ambev SA. Shares of miner Vale SA also fell on the back of lower iron ore prices. Still, the index's losses were limited by a rally in shares of power utilities after the government announced that plans to overhaul power sector rules could lead to higher rates and lower taxes. Shares of state-controlled utility Centrais Elétricas Brasileiras SA, or Eletrobras, which would benefit directly from the revamp, soared as much as 15 percent, their biggest daily increase in four years. Wider emerging markets mostly weakened, extending Wednesday's selloff triggered by proposals to nationalize South Africa's central bank. The South African rand held near seven-week lows even as the central bank tried to calm investors' nerves by stressing its independence was enshrined by the constitution regardless of ownership.
Key Latin American stock indexes and currencies at 1535 GMT:
Stock indexes daily % YTD % change change
MSCI Emerging Markets 1006.66 -0.32 17.12 MSCI LatAm 2539.50 -0.29 8.81 Brazil Bovespa 62706.88 -0.71 4.12 Mexico S&P/BVM IPC 50063.88 -0.47 9.69 Chile IPSA 4820.42 -0.58 16.12 Chile IGPA 24116.97 -0.51 16.32 Argentina MerVal 22487.48 0.24 32.92 Colombia IGBC 11024.10 0.06 8.85 Venezuela IBC 122973.02 -0.54 287.86 Currencies daily % YTD % change change
Brazil real 3.3063 -0.44 -1.73 Mexico peso 18.3280 -0.13 13.18 Chile peso 665.8 -0.02 0.74 Colombia peso 3074.6 0.27 -2.38 Peru sol 3.255 0.06 4.88 Argentina peso (interbank) 17.1000 0.29 -7.16 Argentina peso (parallel) 17.26 -0.29 -2.55
(Reporting by Bruno Federowski; Editing by Lisa Von Ahn)