EMERGING MARKETS-Latam stocks retreat after risk rally; Mexican peso leads FX losses

* Chile's peso supported by strong export data * Mexican peso pressured by weak oil * Brazil's real leads FX gains By Ambar Warrick July 7 (Reuters) - Mexico's peso dropped on Tuesday, tracking weak oil prices while major Latin American stocks came off four-month highs as a recent risk rally paused for breath. While positive economic data had spurred several sessions' gains in Latin American markets, a continued uptick in global coronavirus cases kept caution alive. Regional currencies were pressured by safe-haven flows into the U.S. dollar. "After a hot start, risk is in retreat. We think the market is largely in a waiting game over a multitude of issues related to COVID-19 and politics. That will take time and at a minimum suggests choppy price action for the foreseeable future," analysts at TD Securities wrote in a note. Mexico's peso fell about 0.9% to the dollar, tracking weakness in the crude market as rising cases cast doubts over oil demand. Further clouding an economic recovery from COVID-19, a top Mexican health official said the country's coronavirus pandemic could last until next April. Brazil's real strengthened the most among regional peers, but stayed within a trading range observed over the past week. Improving economic fundamentals in the country have come in stark contrast to a continued rise in new infections, with Brazil standing as the second-worst hit country in the world by the pandemic after the United States, in terms of infections. Brazilian stocks fell slightly, coming off a four-month high. Iron ore miner Vale SA was among the top drags on the Bovespa, after it flagged a $400 million impairment charge related to the planned sale of its long-troubled nickel and cobalt operations on the Pacific island of New Caledonia. Latin American stocks have benefited more from recent liquidity measures, in comparison to currencies, which have been pressured by record-low borrowing rates and sustained dollar demand. Chile's peso was propped up by data showing increased copper exports in June, while total exports also rose from last year. A recent rally in copper prices has also helped the peso, given that the red metal is Chile's largest export. Chilean stocks fell about 1.5% from a near four-month high. Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1054.03 -0.61 MSCI LatAm 1978.48 -0.89 Brazil Bovespa 98787.96 -0.15 Mexico IPC 37719.46 -0.44 Chile IPSA 4218.17 -1.55 Argentina MerVal 0.00 0 Colombia COLCAP 1125.55 -0.35 Currencies Latest Daily % change Brazil real 5.3200 0.58 Mexico peso 22.5380 -0.94 Chile peso 794.7 0.53 Colombia peso 3631.42 0.12 Peru sol 3.5437 0.00 Argentina peso 70.8700 -0.07 (interbank) (Reporting by Ambar Warrick in Bengaluru; Editing by Sandra Maler)