EMERGING MARKETS-Brazil stocks up, utilities drag; Mexico jumps

* Stronger China factory sentiment supports Brazil

* Argentine stocks hit six-month low on default jitters

* Bovespa rises 0.35 pct, Mexico IPC up 0.87 pct

(New throughout)

By Michael O'Boyle

MEXICO CITY, Nov 22 (Reuters) - Brazilian stocks rose on
Thursday as factory data in China raised hopes that an economic
slowdown has hit bottom in Brazil's biggest trading partner,
while Mexican equities jumped toward a record high.

Brazil's Bovespa index rose 0.35 percent while
volume fell to its lowest in a month, with U.S. markets closed
for the Thanksgiving holiday.

"It's a climate of stagnation, which should continue
tomorrow as well," said Aloisio Lemos, an analyst with brokerage
Agora in Rio de Janeiro.

Stocks in Argentina sank to a six-month low after a
U.S. judge ordered Buenos Aires to pay bondholders who shunned
previous swaps of defaulted debt. The ruling raised fears that
the South American country could be headed for another
default.

Chinese factory sentiment in November pointed to growth for
the first time in 13 months, which could boost demand for Latin
American commodities such as iron, soy and oil.

But despite the rise in the Bovespa, the index is near a
more than three-month low, and chart watchers said stocks could
fall more.

Confidence in Latin America's top economy has been hit by
signs that an economic recovery is flagging and fears that
government meddling in controlled prices will hit utilities.

Shares of electricity generator Eletrobras fell
8.47 percent, following a record one-day drop on Wednesday. The
stock has tumbled about 50 percent since October on expectations
the government will force it to cut electricity rates.

"Any change in regulation is going to bring about
uncertainty and when in doubt, investors run. We are seeing a
herd effect," said Hamilton Alves, a senior analyst with BB
Investimentos in Sao Paulo, Brazil.

Eletrobras pared losses after the head of Brazil's state-run
energy research group EPE said the government would not let the
company "perish".

Uncertainty over government intervention hit other companies
that rely on concession contracts, with shares of highway
operator CCR down 1.53 percent.

Shares of Cetip, Brazil's largest securities
clearinghouse, fell 4.58 percent after the company said on
Wednesday its top executive will leave once his contract expires
in July 2013.

Mexico's benchmark IPC rose 0.87 percent as it
clocked its best four-day run since June with a 3.6 percent
gain, rebounding off its lowest since September.

Top retailer Wal-Mart de Mexico rose 1.67
percent to its highest since April, when news emerged that U.S.
prosecutors were investigating charges it bribed officials to
open stores more rapidly in Mexico.

"Those concerns are fading as we get to the high-volume
buying season," said Roberto Galvan, a strategist at brokerage
Actinver in Mexico City, noting the stock got a lift from a long
weekend this month in which sales drove a spike in retail
traffic.

A technical momentum indicator known as the MACD posted a
"bullish cross", suggesting Mexico's IPC index could extend its
rally further in coming sessions.

Mexican stocks have received a boost as investors turned
more optimistic on fiscal negotiations in the United States,
Mexico's top trading partner. Stronger-than-expected U.S. demand
has supported Mexico in a wider global slowdown. The IPC is
trading less than 2 percent off a record high hit in October.

Latin America's key stock indexes at 2240 GMT:
Stock indexes daily year-t

% -date

Latest change %

change
MSCI LatAm 3,564.52 0.49 -1.05

Brazil Bovespa 56,436.97 0.35 -0.56

Mexico IPC 42,032.35 0.87 13.36

Chile IPSA 4,139.68 -0.14 -0.91

Chile IGPA 20,356.00 -0.26 1.12

Argentina MerVal 2,242.40 -3.33 -8.94

Colombia IGBC 14,190.01 -0.02 12.03

Peru IGRA 20,039.84 -0.31 2.91

Venezuela IBC 386,233.2 0.61 230.01

(Additional reporting by Asher Levine and Danielle Assalve in
Sao Paulo; Editing by Dale Hudson)