EMERGING MARKETS-Brazil stocks fall on investor caution on Fed
* Brazil Bovespa falls 1.81 pct, Mexico IPC down 0.44 pct
SAO PAULO Dec 11 (Reuters) - Brazilian stocks fell the lowest in more than a week on Wednesday as investor caution over a potential reduction in monetary stimulus from the U.S. Federal Reserve led to a fall in the most heavily weighted shares.
Mexico's IPC index fell nearly half a percent, while Chile's bourse dropped nearly a quarter of a percent.
The U.S. Congress announced a provisional budget deal on Tuesday, which some investors expect will strengthen the view that the Fed might soon scale back its massive bond-buying program. The Fed's program has helped support global demand for riskier assets such as Latin American equities.
The Fed's next policy-setting meeting is scheduled to take place on Dec. 17 and 18.
Brazil's benchmark Bovespa stock index lost 1.81 percent to 50,067.99.
State-run oil company Petroleo Brasileiro SA, known as Petrobras, fell 3.01 percent, contributing most to the index's decline, while Itaú Unibanco Holding SA, Brazil's largest non-government bank, fell 2.66 percent. Both companies tend to attract a large share of foreign investors seeking exposure to local equities.
Mexico's IPC index fell 0.44 percent to end the day on 42,304.55 points.
The shares of conglomerate Alfa, down 3.3 percent, led losses, while miner and infrastructure company Grupo Mexico was 2.46 percent off. Both companies are seen as winners of the energy reform bill the Mexican Senate passed on Wednesday, and their shares rose sharply in the days leading up to the Senate approval.
Chile's IPSA index fell slightly as shares of Banco Santander Chile dropped 1.99 percent.
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