(Adds trade details, updates prices) By Susan Mathew Dec 13 (Reuters) - Latin American markets rose on Friday as investors welcomed a limited U.S.-China trade deal, and as U.S. President Donald Trump said Washington would suspend tariffs on Chinese imports scheduled to take effect on Sunday. China and the United States have agreed on the text of a "phase one" trade deal, Beijing said on Friday, agreeing also to step up purchases of U.S. agricultural products in a major step forward in resolving a trade war that has hit global supply chains and roiled markets for over 16 months. Mexican shares jumped 2.5% to a month high, and Chile stocks rose to their highest since late November. An index of Latam shares rose 0.8%. Caution prevailed, however, as the deal is yet to be signed. White House adviser Larry Kudlow warned that if China does not comply with the trade deal, action will be taken, including the possible imposition of tariffs. "Although it seems agreement has been reached about the content of the deal, the legal text is still to be drafted, which could create problems," wrote Timme Spakman, economist, international trade analysis at ING, in a note. "This phase one deal does not include the most sensitive topics, so considerable hurdles remain for a full deal that resolves the trade war." Investors also bought risk assets after British Prime Minister Boris Johnson's ruling Conservative Party won a solid majority, boosting confidence London would accomplish an orderly exit from the European Union. Brazil stocks edged up to scale new highs, driven by consumer and commodity-linked stocks. Oil and gas heavyweight Petroleo Brasileiro SA , however, fell after the Brazilian state development bank said it was considering selling up to all of the ordinary shares it holds in the state-run oil company via a secondary offering. Regional assets were set to gain for the week when support also stemmed from dovish indications from the U.S. Federal Reserve. Against a weaker dollar, Brazil's real fell 0.4% after two days of gains, while Colombia's peso slipped 0.5% to break a seven session winning streak. The Mexican peso rose marginally, having touched its strongest against the dollar in more than four months on positive news about the U.S.-Mexico-Canada Agreement trade deal. Key Latin American stock indexes and currencies at 1930 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1086.80 1.5 MSCI LatAm 2836.04 0.78 Brazil Bovespa 112394.19 0.17 Mexico IPC 44290.43 2.54 Chile IPSA 4885.32 1.45 Argentina MerVal 36921.08 3.989 Colombia COLCAP 1628.30 0.6 Currencies Latest Daily % change Brazil real 4.1067 -0.36 Mexico peso 19.0476 0.01 Chile peso 763.5 0.75 Colombia peso 3381 -0.35 Peru sol 3.366 0.27 Argentina peso 59.8150 0.00 (interbank) (Reporting by Susan Mathew in Bengaluru; Editing by Richard Chang)
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