To The Moon

Updates with afternoon trading levels

By Nikhil Sharma and Shashwat Chauhan

June 13 (Reuters) - Emerging market stocks and currencies declined on Friday as investors shunned risky assets amid growing conflict between Israel and Iran, with Latin American assets also swept up in the global selloff.

Iran's state news agency IRNA said late on Friday that hundreds of ballistic missiles had been launched in retaliation for Israel's biggest ever attacks on Iran.

Israel's shekel ILS= plunged 1.9% against the dollar, while its dollar-denominated sovereign bonds fell about 1 cent each on the dollar. MSCI's index tracking Israeli equities .MIIL00000PUS dropped 2.4%.

MSCI's index tracking emerging market equities .MSCIEF was last down 1%, though set for firm weekly gains.

Sovereign dollar bonds of frontier nations too slid across the board, with longer duration maturities of Egypt, El Salvador and Sri Lanka all clocking losses.

In Latin America, Mexico's peso MXN= shed 0.4% and Chile's peso CLP= slipped 0.7% against the dollar.

Brazil's real BRL= shed most of its losses on the day and was last flat at 5.53 per dollar.

Investors have been monitoring Brazil's push for a new fiscal package to lift tax revenues and restore fiscal balance. The country's central bank is widely expected to hold its main lending rate steady next week.

Chile's central bank, too, is expected to hold its lending rate steady when it meets next week. Peru's central bank held its benchmark interest rate at 4.5% in a decision late on Thursday.

Mexican central bank Deputy Governor Jonathan Heath said on Friday that the bank should avoid cutting its benchmark interest rate by 50 basis points until inflation resumes a clear downward trajectory.

In Colombia, four sources from government agencies and the Congress told Reuters that the government will present a tax reform bill to Congress to raise 19 trillion pesos ($4.53 billion) more to help fund the 2026 budget.

On Friday, escalating geopolitical tensions prompted investors to seek safe-haven assets such as the U.S. dollar. The greenback =USD firmed 0.5%.

"Whether these trends persist or reverse will depend on how long and intense the conflict is and whether other regional actors get involved, and second, whether there is any additional impact on oil transit through the Persian Gulf which can cause a larger shock to global inflationary pressures," Goldman Sachs analysts said.

MSCI's index tracking Latin American currencies .MILA00000CUS was flat, hovering near a record high, while an index for stocks .MILA00000PUS shed 0.2%.

Brazil's local index .BVSP dipped 0.3%, though surging oil stocks helped crimp losses as supply concerns in the Middle East lifted oil prices more than 8%.

Joan Domene, senior economist at Oxford Economics, said losses in Latin America were restrained by a jump in commodity prices.

In Buenos Aires, the main stock index .MERV fell 2.9% while Argentina's international dollar bonds fell in tandem with the global risk aversion.

Highlights:

** Brazil services activity grows 0.2% in April (Read more)

** Former Bolsonaro aide to face questioning, arrest order suspended, media reports (Read more)

** Expenses portion of Brazil fiscal package to save government $2.7 billion through next year (Read more)

Key Latin American stock indexes and currencies:

(Reporting by Nikhil Sharma and Shashwat Chauhan; Editing by Alistair Bell and Sahal Muhammed)

((Nikhil.Sharma@thomsonreuters.com; Shashwat.Chauhan@thomsonreuters.com))