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EMERGING MARKETS-Mexico stocks clock worst month in 6-1/2 years on Fed, NAFTA worries

worries@ (Updates prices) SAO PAULO, Feb 28 (Reuters) - Mexican equities fell sharply again on Wednesday, capping their worst month in 6-1/2 years, as a mediocre corporate results season wrapped up amid uneasy negotiations to save the North American Free Trade Agreement. Markets also continued to be spooked following a relatively hawkish speech by the newly appointed head of the Federal Reserve Jerome Powell that raised speculation about increased monetary tightening in the United States in 2018. In a note to clients, Mexican brokerage Monex said global markets were continuing to show mixed movements, but with a downward bias, after Powell's speech. U.S., Mexican and Canadian officials are meeting in Mexico City in their seventh round of talks to overhaul the NAFTA trade deal. Talks have been complicated by the threat the United States could impose tariffs on steel. The benchmark IPC index shed 1.1 percent to close at its lowest since December. The index fell 6 percent in the month in its worst monthly percentage loss since September 2011. Brazil's Bovespa lost about 1.7 percent. Brazil's main stock gauge managed a monthly advance of about 1 percent. Shares in major Brazilian miner Vale SA fell about 4.8 percent, its worst drop since last May, following fourth quarter results that missed analysts estimates.

Shares in major planemaker Embraer SA lost 4.7 percent after a report in Brazilian newspaper O Globo said that newly appointed defense minister Joaquim Silva e Luna has been one of the most avid opponents of a proposed joint venture between Embraer and U.S. planemaker Boeing SA. The company's chief executive said he expected the talks to be concluded in the first half of 2018.

Key Latin American stock indexes and currencies at 20:59 GMT:

Stock indexes daily YTD %

% chang

Latest chang e

e

MSCI Emerging Markets 1194.21 -1.49 4.65 MSCI LatAm 3071.57 -1.69 10.47 Brazil Bovespa 85481.47 -1.67 11.88 Mexico IPC 47364.22 -1.26 -4.03 Chile IPSA 5602.83 -0.69 0.69 Chile IGPA 28132.18 -0.64 0.54 Argentina MerVal 33010.90 1.52 9.80 Colombia IGBC 11443.09 -2.73 0.64 Venezuela IBC 4242.88 -5.26 235.9

0

Currencies daily YTD %

% chang

chang e Latest e Brazil real 3.2467 -0.14 2.05 Mexico peso 18.8530 -0.02 4.49 Chile peso 594.5 -0.40 3.39 Colombia peso 2865 -0.35 4.08 Peru sol 3.266 -0.43 -0.89 Argentina peso (interbank) 20.1100 0.65 -7.51 Argentina peso (parallel) 20.22 0.30 -4.90

(Reporting by Gram Slattery Editing by Diane Craft)