Mexico peso, stocks wilt on recession worries

(Adds closing prices)

MEXICO CITY, Nov 18 (Reuters) - Mexico's peso weakened sharply on Tuesday and stocks sank as investors worried that a deep global recession will drag down economic growth in the country.

The peso MXN=MEX01 lost 1.73 percent to 13.1675 per dollar at the central bank's final reference compared to Friday's close. Local markets were closed on Monday due to a public holiday.

The benchmark IPC stock index .MXX closed 2.69 percent lower at 19,036.23 points as the shares of Cemex, the world's No. 3 cement maker, hit a 9-1/2-year low.

Due to Monday's holiday, traders said investors were also factoring in steep losses in global markets from the previous session, when data showed Japan has fallen into recession and financial giant Citigroup (C.N) said it will cut 52,000 jobs.

Moreover, uncertainty about a government rescue package for troubled U.S. automaker General Motors (GM.N) and growing expectations of a deep recession in the United States bode poorly for Mexico, which sends around 80 percent of its exports to its northern neighbor.

"In Mexico, we are also expecting growth to slow a lot in the fourth quarter and we can't rule out it going negative either," said Gerardo Copca, an analyst at MetAnalisis consultancy in Mexico City.

"With the way things are going, we could see a deceleration in the first quarter (of next year) as well," he said.

Mexico's peso has lost a quarter of its value against the U.S. dollar since early August as investors dumped emerging market assets amid the worst financial crisis in more than 80 years. The IPC is down more than 35 percent for the year.

In debt trading, the yield on the government's benchmark 10-year peso bond MX10YT=RR jumped 14 basis points to 9.84 percent.

In the equities market, shares of Cemex (CMXCPO.MX) plunged 9.56 percent to 6.15 pesos, its lowest closing price since March 1999.

Investors have been dumping Cemex on worries the company could have trouble paying $6.6 billion in debt next year as it faces a downturn in its major markets, the United States and Europe.

Cemex shares in New York (CX.N) lost 5 percent to $4.75.

Shares of Carso Telecom (TELECOMA1.MX), used by billionaire Carlos Slim to control his holdings in fixed-line giant Telmex (TELMEXL.MX)(TMX.N) and its recent spin-off Telmex Internacional (TELINTL.MX)(TII.N), fell 5.44 percent to 41.55 pesos.

Shares of Grupo Televisa (TLVACPO.MX), the world's biggest producer of Spanish language TV content, lost 5.31 percent to 37.46 pesos while its shares in Wall Street (TV.N) lost 2.67 percent to $14.22. (Reporting by Michael O'Boyle; Editing by Leslie Adler)