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EMERGING MARKETS-Mexico peso up on wary central bank, Brazil stocks fall

(Recasts with peso gains) SAO PAULO, Nov 9 (Reuters) - Mexico's peso gained on Thursday after the central bank signaled it would not cut interest rates anytime soon after a recent currency slump threatens to fan inflation while Brazilian stocks fell after a batch of weak corporate reports. Mexico's peso firmed nearly 0.3 percent after the central bank said that the inflation outlook had worsened and that it would maintain a prudent monetary policy given the risks Latin America's No. 2 economy is facing. The peso was battered last month to its weakest level since March on concerns that U.S. President Donald Trump could pull out of the North American Free Trade Agreement (NAFTA) with Mexico and Canada. " 1/8The central bank board 3/8 is very worried about the potential impact on the currency from uncertainty around NAFTA talks," said Banorte analyst Alejandro Cervantes. The benchmark Bovespa stock index fell over 1.9 percent after rising the most in a month on Wednesday. Shares of fuel distributor Ultrapar Participações SA fell after slightly weaker-than-expected third-quarter operating profits fueled doubt over its year-end target. Lender Banco do Brasil SA and petrochemical company Braskem SA also dropped in the wake of quarterly earnings figures. The move came in a week of heightened volatility as uncertainty grew over President Michel Temer's efforts to streamline the social security system. Lawmakers seem increasingly unwilling to support Temer's austerity efforts, which contributed to driving his approval rates to single digits. Investors see the pension reform as key to curbing growth of public debt and stimulating the economy.

Key Latin American stock indexes and currencies at 2215 GMT:

Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1133.30 -0.12 31.59 MSCI LatAm 2790.14 -1.11 20.54 Brazil Bovespa 72930.69 -1.93 21.09 Mexico IPC 48713.51 -0.25 6.73 Chile IPSA 5443.89 -0.76 31.13 Chile IGPA 27398.65 -0.71 32.14 Argentina MerVal 27951.54 -0.46 65.22 Colombia IGBC 10806.63 0.74 6.70 Venezuela IBC 685.51 -2.56 -97.84 Currencies daily % YTD % change change

Latest

Brazil real 3.2589 0.13 -0.09 Mexico peso 19.0350 0.28 8.98 Chile peso 629.85 0.23 6.49 Colombia peso 3009 0.30 -0.25 Peru sol 3.241 0.12 5.34 Argentina peso (interbank) 17.5025 0.13 -9.30 Argentina peso (parallel) 17.9 0.00 -6.03

(Additional reporting by Bruno Federowski in Sao Paulo; editing