EMERGING MARKETS-LatAm stocks poised to end week higher amid Venezuela volatility

Recasts with afternoon prices

By Twesha Dikshit, Ragini Mathur and Pranav Kashyap

Jan 9 (Reuters) - LatAm equities climbed on Friday and headed for a strong weekly finish, with investors glued to fast-moving developments in Venezuela while parsing a mix of U.S. and local data for fresh signals on the next rate moves in Washington and Brazil.

MSCI's Latin American equities index .MILA00000PUS rose 0.4%, and was on track for a weekly gain of almost 3%. A corresponding currency gauge .MILA00000CUS was up 0.2%.

This week's markets have been jolted by geopolitics, and few trades captured that better than Venezuela's bonds, which outperformed after the U.S. military captured President Nicolas Maduro.

The surge extended a blockbuster run that has seen the country's defaulted sovereign debt more than double in price over the past year - enough to prompt Aberdeen Investments to start trimming its exposure, a portfolio manager told Reuters.

At the same time, a key bondholder group says it's ready to open debt-restructuring talks once it has authorization, while Venezuela's government has begun exploring expanded diplomatic ties with Washington, underscoring the shift from speculation toward concrete next steps.

"Trump's pivot towards explicit control of Venezuela's natural resources highlights an emerging trend of resource nationalism," UBP analysts said.

"Beyond Venezuela, concerns extend to the broader Latin American region, which plays a critical role in global commodity supply. This environment calls for heightened attention to geopolitical tail risks, supply chain resilience challenges, and alliance dynamics."

Investors remained optimistic about Latin American assets at the start of a year that will see elections in Brazil, Peru and Colombia, with Trump's actions in the region potentially driving a shift to the right which in turn could lead to more market-friendly policies.

European Union states, meanwhile, gave the provisional go-ahead for the bloc to sign its largest ever free trade accord with South America's Mercosur, more than 25 years after negotiations first began.

DATA, RATE CUT PATH IN FOCUS

U.S. jobs growth slowed more than expected in December with businesses cautious about hiring, while the unemployment rate dipped to 4.4% leaving the door open for future Federal Reserve rate cuts.

Brazilian equities .BVSP added 0.5% and the real BRL= firmed 0.4% against the greenback. Data from Latin America's largest economy showed annual inflation slowed more than anticipated last year, solidifying expectations for monetary easing.

Mexico's benchmark index .MXX and the peso MXN= both edged marginally lower. Official data showed industrial output rose 0.6% in November from the previous month.

Argentina's equities .MERV slipped 0.1% while the peso ARS=RASL was flat. U.S. Treasury Secretary Scott Bessent said the nation had repaid the United States for a currency swap framework that helped stabilize the economy.

Key Latin American stock indexes and currencies:

(Reporting by Twesha Dikshit, Ragini Mathur and Pranav Kashyap; Editing by Kirsten Donovan and Chizu Nomiyama )

((Twesha.Dikshit@thomsonreuters.com;))