(Updates prices) SAO PAULO, Aug 9 (Reuters) - Latin American stocks and currencies fell on Wednesday, with the Brazilian real and the Mexican peso leading the losses, as investors fled for safe-haven assets amid brewing geopolitical tensions between the United States and North Korea. North Korea said it is "carefully examining" plans for a missile strike on the U.S. Pacific territory of Guam just hours after U.S. President Donald Trump said that any threat to the United States would be met with "fire and fury." Trump followed up his warning with a boast on Wednesday about the strength of the American nuclear arsenal, although he expressed hope it would not need to be used. Emerging markets suffered as investors fled to the safety of U.S. bonds, with a widely followed measure of U.S. stock market anxiety jumping to a one-month high. The Mexican peso, which is typically used as a hedging instrument for other less liquid regional currencies, suffered among the biggest losses in Latin American foreign exchange markets. The move came ahead of a pivotal week for the Mexican currency as policymakers are set to begin negotiations on the North American Free Trade Agreement between the United States, Mexico and Canada. Hopes that the countries could quickly reach a beneficial agreement have lifted the Mexican peso this year, making it one of the world's best-performing currencies. Still, some traders say that the peso's standing may be fragile. "There is risk of a selloff if NAFTA negotiations don't progress well, although most observers don't expect such an outcome," strategists at 4Cast wrote in a report. The Brazilian real slipped nearly 0.7 percent. Hopes that President Michel Temer will manage to pass a proposed overhaul of Brazil's pension system have kept the currency near its strongest levels in three months, but political concerns have limited further gains. The exchange rate has hovered around 3.15 reais to the dollar since mid-July. Current levels are "are pretty fair so the strategy is more a 'selective buying' instead of a big directional trade," Santander director Sandro Sobral wrote in a note to clients. Brazil's benchmark Bovespa stock index fell 0.5 percent as risk aversion triggered profit-taking on shares of meatpacker JBS SA after a seven-day stretch of gains. Shares of rental car company Movida Participações SA , which are not part of the benchmark index, fell the most in 11 weeks after costs and expenses hurt second-quarter operating profit.
Key Latin American stock indexes and currencies at 1943 GMT:
Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1067.70 -1 25.08 MSCI LatAm 2774.93 -0.67 19.35 Brazil Bovespa 67538.77 -0.53 12.14 Mexico IPC 51172.76 -0.3 12.12 Chile IPSA 5081.37 -0.84 22.40 Chile IGPA 25342.66 -0.79 22.23 Argentina MerVal 20927.83 -1.54 23.70 Colombia IGBC 10820.88 -0.35 6.84 Venezuela IBC 184187.97 -6.39 480.94 Currencies daily % YTD % change change
Brazil real 3.1499 -0.67 3.15 Mexico peso 17.9590 -0.58 15.51 Chile peso 648 0.03 3.50 Colombia peso 3001 -0.15 0.02 Peru sol 3.248 -0.18 5.11 Argentina peso 17.6950 0.16 -10.29
Argentina peso 18.36 0.22 -8.39
(Reporting by Bruno Federowski; Editing by James Dalgleish and Phil Berlowitz)