* Brazil, U.S. manufacturing down, euro zone at 2.5-year low
* Brazil Bovespa falls 0.16 pct, Mexico IPC down 0.37 pct
By Danielle Assalve and Rachel Uranga
SAO PAULO/MEXICO CITY, July 2 (Reuters) - Latin American stocks slipped o n M onday as weak manufacturing data from several of the world's major economies dampened investor optimism over a global economic recovery.
Banks and commodities exporters contributed most to a slight drop in Brazil's Bovespa index, while retail giant Walmex weighed on Mexico's IPC index. Chile's stock market was closed due to a religious holiday.
Shares slipped early in the session after data showed manufacturing activity in the euro zone continues to hold at a 2-1/2 year low, while Brazil's manufacturing output in June shrank for the third straight month and export orders fell across Asia's major economies.
The outlook for global economic growth was dealt a further blow later in the session after data showed the U.S. manufacturing sector unexpectedly contracted in June for the first time in nearly three years.
"The data leaves investors worried that the very modest recovery in the U.S. economy may be vulnerable," said Edson Hydalgo Junior, a director at Sao Paulo brokerage InTrader. "The market will remain quite tense and volatile as it follows the news."
Brazil's benchmark Bovespa stock index slipped for the third session in four. Preferred shares of iron-ore giant Vale lost 0.69 percent, contributing most to the index's fall, while those of state-controlled oil producer Petrobras slipped 1.27 percent.
The Bovespa index is down more than 4.5 percent in 2012 after fears of a deteriorating euro zone debt crisis and weaker economic growth, both in Brazil and abroad, drove investors away from riskier assets.
Brazil's central bank has taken steps to support activity in Latin America's largest economy by slashing its benchmark Selic interest rate to record lows and is expected to continue doing so. That may lead some of the country's institutional investors away from Selic-indexed bonds, said Hydalgo Junior, which could auger well for Brazilian stocks.
"With the lower interest rates we have nowadays in Brazil, some investors, principally pension funds, will need to take on more risk, returning to the equities market to look for returns," he said.
Shares of Cielo, Brazil's largest card payment processor, slipped 0.49 percent. The company said o n M onday it will buy U.S. payment solutions provider Merchant e-Solutions for $670 million, enabling it to settle more online purchases.
Mexico's IPC index capped a six-day rally and retreated from record-high levels achieved in the previous session. Retail giant Wal-Mart de Mexico fell 1.59 percent, contributing most to the index's decline, while bottling firm Femsa rose 1.43 percent.
While weak manufacturing data in the United States contributed to the IPC's fall, stocks were supported early in the session by the country's presidential election, where Enrique Pena Nieto, an opposition front runner who campaigned on fiscal and energy reforms, claimed victory. [ID: nL2E8I108P]
"It's had a good influence on the market," said Gerardo Copca, a strategist at consultancy Metanalisis in Mexico City. "If Pena Nieto ... makes good on his promises it's going to really benefit the construction sector."
Among other reforms, Pena Nieto has pledged to boost investment in the country's infrastructure and spur bank lending, raising hopes for the country's slow growing economy.
Mexican construction company ICA advanced 2.82 percent while Mexican homebuilder Urbi Desarrollos Urbanos rose 0.86 percent.
Latin America's key stock indexes at 16:46 GMT Stock indexes daily % YTD %
Latest change change MSCI LatAm 3,549.65 0.8 -2.24
Brazil Bovespa 54,266.50 -0.16 -4.38
Mexico IPC 40,051.00 -0.37 8.02
Chile IPSA 4,400.10 1.47 5.33
Chile IGPA 21,079.74 1.24 4.72
Argentina MerVal 2,349.36 0.11 -4.60
Colombia IGBC 13,417.51 1.55 5.94
Peru IGRA 20,427.32 1.09 4.90
Venezuela IBC 0.00 0 -100.00
(Writing by Asher Levine; Editing by Dan Grebler)