CORRECTED-EMERGING MARKETS-Latam FX, stocks mixed as markets weigh Iran-Israel truce

By Ragini Mathur and Purvi Agarwal

June 25 (Reuters) - Most Latin American currencies were flat to higher while stocks were mixed on Wednesday as investors assessed the stability of a ceasefire between Iran and Israel that halted hostilities.

U.S. President Donald Trump revelled in a swift end to hostilities in the Middle East, expressing confidence that improved U.S.-Iran relations would prevent Tehran from rebuilding its nuclear program.

On the day, assets in the Middle East were mixed. Israeli stocks .TA125 closed 1.7% higher, around a record high hit on Tuesday. The shekel ILS= retreated 0.1% from a more than two-year high.

Israel international bonds were up a little, extending previous days' gains, while five-year credit default swaps slipped. Egypt's longer-dated maturities were up close to 1 cent and Jordan's over half a cent, Tradeweb data showed.

The 12-day conflict had jolted global markets, especially in the Middle East, as it raised concerns over a wider regional war and upending oil supply.

In Latin America, Mexico's currency MXN= gained 0.4%, ahead of a monetary policy report by the central bank.

"It was interesting to me that Latam rose so much after the ceasefire because we didn't seem to have a big drop down when the conflict became increasingly likely," said Charles Sunnucks, portfolio manager for EM strategy at Oldfield Partners, highlighting that countries such as Mexico and Brazil would benefit from higher commodity prices.

"Today kind of seems like a step back (from the rally)."

BIGGEST DECLINER

On the flip side, Brazil's real BRL= was the biggest decliner, down 0.8%. The country posted a narrower-than-expected current account deficit in May, though the gap widened from a year earlier as a shrinking trade surplus continued to weigh on the external balance.

Moves in other currencies including the Chilean peso CLP= and the Colombian peso COP= were limited.

Still, MSCI's index for regional currencies .MILA00000CUS dipped 0.5%, set for its steepest single day fall since late May, while the regional stock gauge .MILA00000PUS dipped 0.6%.

Equities in the region were mixed, with heavyweight Brazilian ones .BVSP down 0.7%, dragged by a 1.8% drop in Eletrobras ELET6.SA.

Bourses in Mexico .MXX gained 0.4% and Chile .SPIPSA were 0.2%, respectively.

Meanwhile, Argentina, the International Monetary Fund's biggest debtor, seeks a waiver for falling short on foreign currency reserve targets linked to its new $20 billion deal.

The country signed the new deal with the IMF early in April, and agreed to loosen capital controls.

Investor focus will now turn to the U.S. economy, with a slew of economic data scheduled for this week, to gauge the economic impact of Trump's tariffs which have unsettled financial markets in recent months.

Key Latin American stock indexes and currencies: