(Recasts throughout, updates prices) * Brazil currency dives almost 3 percent, stocks down 3.6 percent * Argentina peso hits fresh all-time low vs dollar * Mexican shares buck gloom, rise 0.3 percent By Susan Mathew March 27 (Reuters) - Latin American shares and currencies fell to their lowest since first trading day of the year on Wednesday, with Brazil shares tumbling more than 3 percent, while currencies weakened against a strong dollar. MSCI's index of Latin American shares slumped 3.8 percent, while its index of regional currencies slipped 1.6 percent, both hitting their lowest since Jan. 2. Brazilian shares dove 3.6 percent to eleven-week lows, with 64 of its 65 components declining. Brazil's currency, the real, plummeted 2.9 percent to near six-month lows and finished at 3.99 per dollar. The sell-off in Brazilian markets was spurred by a measure to seize more control over the federal budget receiving near-unanimous approval by Brazil's lower house of Congress, adding to concerns that President Jair Bolsonaro is losing momentum in his push for ambitious economic reforms. Bolsonaro rode to presidency on a promise to overhaul the nation's bloated pension system to shrink public debt, and his government is now facing slack about its lack of leverage in debate on the pension reform plan as it makes its way through Congress. "The impression is that Bolsonaro does not correctly define his priorities and there is no sign that this will change," said Pedro Menezes, partner at Occam Brasil Gestão de Recursos, adding that markets will now be convinced only by concrete actions. While most stock markets in the region ended well into the red, in line with world stocks that fell amid growth slowdown fears, Mexican shares rose 0.3 percent. Among top gainers were local shares of Banco Santander , which rose nearly 3 percent, tracking a rise in the bank's Spanish shares, while pharma firm Genomma Lab climbed 4.6 percent. The Argentine peso slid to all-time lows against the dollar as concerns about inflation, weak growth and October's presidential election weighed. The currency has lost 14 percent so far this year and the weakness raises fears of a repeat of the currency crisis of 2018 when the currency lost half its value against the dollar. Besides a strong dollar, currencies of net crude exporters Mexico and Colombia were further hit by a dip in oil prices. Key Latin American stock indexes and currencies at 2100 GMT: Stock indexes Latest Daily pct change MSCI Emerging Markets 1,044.10 -0.6 MSCI LatAm 2,648.37 -3.79 Brazil Bovespa 91,903.40 -3.57 Mexico IPC 42,947.55 0.28 Chile IPSA 5,174.14 -0.32 Argentina MerVal 32,174.68 -1.39 Colombia IGBC 12,915.28 -1.93 Currencies Latest Daily pct change Brazil real 3.9933 -2.91 Mexico peso 19.3550 -1.30 Chile peso 682.7 -0.31 Colombia peso 3,173.8 -0.63 Peru sol 3.317 -0.33 Argentina peso (interbank) 43.8700 -2.78 (Reporting by Susan Mathew in Bengaluru and Paula Arend Laier in Sao Paulo; editing by G Crosse)
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