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EMERGING MARKETS-Latin American stocks seesaw after Trump tariff threats

(Recasts with stocks recovering, Mexican peso outlook) MEXICO CITY, March 2 (Reuters) - Latin American stocks ended mixed on Friday, with some indexing clawing back narrow gains after earlier sinking broadly on concerns about U.S. President Donald Trump's plan to tack tariffs on to steel and aluminum imports. Brazil and Mexico, the region's two largest economies, are both major steel exporters to the United States. Trump's threats to unleash a trade war over steel and aluminum crushed hopes of substantial progress in the latest talks in Mexico City to rework the North American Free Trade Agreement. Analysts said Mexico's peso could face pressure from concerns the negotiations could flop. Mexico sends about 80 percent of its total exports to the United States. "Volatility from trade issues will continue to put pressure on the peso in the coming weeks along with the approach of the elections," said Carlos Capistran, an economist at Bank of America Merrill Lynch. Mexico will elect its next president on July 1 and a leftist is leading in polls. The peso touched a seven-week low early in the day, but firmed to end the session little changed. The currency shed about 1.5 percent against the dollar on the week. Across Latin America, shares of miners and steelmakers weakened after news of Trump's proposal to slap a 25 percent tariff on imported steel and a 10 percent tariff on aluminum.

Brazilian miner Vale SA, which mines key steel-making ingredient iron ore, fell about 1.6 percent while steelmaker Minas Gerais SA shed nearly 4 percent.

"Everyone wanted to take profits," said Ari Santos, manager at the Bovespa desk at brokerage Hencorp Commcor. "So the market took advantage of Trump's talk to do it." Brazil's Bovespa has pulled back more than 2 percent since it hit a record high last month. On Friday, it shook off broad early losses to end trade up 0.45 percent. In Chile, iron and steelmaker Cap SA fell over 3 percent, after falling 5.6 percent on Thursday.

Key Latin American stock indexes at 2230 GMT:

Stock indexes Latest Daily pct YTD pct change change MSCI Emerging Markets 1,182.06 -0.85 2.04 MSCI LatAm 3,065.75 0.11 8.4 Brazil Bovespa 85,761.34 0.45 12.25 Mexico IPC 47,548.10 -0.11 -3.66 Chile IPSA 5,545.48 0.32 -0.34 Chile IGPA 27,799.46 -0.03 -0.65 Argentina MerVal 31,900.70 -0.35 6.10 Colombia IGBC 11,268.14 -0.47 -0.90 Venezuela IBC 4,161.85 -0.84 229.48

(Additional reporting by Gram Slattery in Sao Paulo, editing by G Crosse)