EMERGING MARKETS-LatAm FX, stocks slide as tech selloff, commodity crash sap risk appetite

By Purvi Agarwal and Ragini Mathur

Feb 5 (Reuters) - Latin American currencies weakened broadly against the dollar on Thursday as a sharp selloff in technology stocks and precious metals sent shockwaves through global markets, dampening investor appetite for emerging market equities.

The commodity-driven decline hit resource-rich economies particularly hard. Colombian stocks .COPCAP fell 1.8%, tracking oil's 2% plunge, while Chilean equities .SPIPSA - sensitive to copper prices as the world's largest exporter - dropped 1.5% after the red metal retreated alongside precious metals.

Gold prices slid and silver sank over 11% as investors booked profits after a two-session rally, extending the whiplash in commodity markets that has largely impacted resource-rich emerging markets.

An ongoing sell-off in technology stocks also injected fresh volatility in equity markets.

"It's been a tough week for investors who were heavily exposed to the parts of the market that led the upside. Technology and AI, but more recently we've also seen gold and precious metals sell off," said Mona Mahajan, principal head of investment strategy and asset allocation at Edward Jones.

"Investors need to be more thoughtful in diversification. Emerging markets and international equities have held up better and we see opportunity out there, but it's a diversified opportunity set."

BANXICO HOLDS STEADY

Mexico's stocks .MXX and currency MXN= were down 0.3% each after the country's central bank held its benchmark interest rate at 7% in a unanimous decision.

The Banxico verdict was in line with expectations amid recent upticks in both inflation and economic growth.

Liam Peach, senior emerging markets economist at Capital Economics, said the meeting was "slightly more hawkish overall", noting the timing of the next rate move may hinge on inflation improvements.

In a rare bright spot, Brazilian stocks .BVSP gained 0.9%, largely buoyed by a 2.3% gain in Itau Unibanco ITUB4.SA after the lender estimated on Wednesday that its loan book will grow by up to 9.5% this year, as it posted a fourth-quarter recurring profit.

The gains limited overall losses at 0.4% on MSCI's index tracking Latin American stocks .MILA00000PUS.

CURRENCIES DIP

On the FX front, most currencies weakened against the greenback, partly aided by the dip in commodity prices.

Colombia's peso COP= dipped 0.7%. The country's central bank head Leonardo Villar said the sharp 100-basis-point interest rate jump in Colombia last month is still not enough to maintain a contractionary monetary policy stance.

Chile's peso CLP= depreciated 0.7%.

Brazil's real BRL= was down 0.2%, bringing the MSCI measure of regional currencies .MILA00000CUS down 0.3%.

Argentina's peso ARS=RASL bucked the trend, gaining 0.4%. Argentina and the U.S. signed an agreement on critical minerals on Wednesday to strengthen and secure supply chains, amid a U.S. push for a preferential trade bloc for critical minerals.

Beyond Latin America, the Czech central bank held interest rates steady, as expected, despite a drop in inflation to a nine-year low and indications that policymakers might consider further easing.

Moody's cut Indonesia's credit rating outlook to negative from stable, citing reduced predictability in policymaking days after MSCI flagged transparency issues that triggered a market rout of more than $80 billion.

Key Latin American stock indexes and currencies: