EMERGING MARKETS-Latam stocks rebound after steep fall

* Brazilian stocks bounce back the most, banks lead

* Disappointing U.S. data weighs on Mexican market (Recasts, adds comments, updates prices)

By Michael O'Boyle and Luciana Lopez

MEXICO CITY/SAO PAULO, July 1 (Reuters) - Latin American stocks rose on Thursday as investors snatched up bargains among shares battered by fears of slower global growth, with Brazil's banking sector receiving a rush of interest.

The MSCI Latin American stocks index .MILA00000PUS rose 0.14 percent to 3644.76, recovering from an early session drop to its lowest levels since early June.

"A lot of people who got out recently are looking at buying again," said Moacir Marcos Junior of the InterBolsa do Brasil brokerage in Sao Paulo.

Analysts say Brazil, where the domestic economy is booming, could hold up better than other markets like Mexico, which depends on the United States to buy around 80 percent of its exports.

"The strong fundamentals of the Brazilian economy and a shaky global economic environment lead us to believe that companies more exposed to Brazil's domestic economy should do better in the medium-to-long term," BTG Pactual analysts Carlos Sequeira and Antonio Junqueira wrote in a report.

Key U.S. data on non-farm payrolls on Friday could give the market more guidance after a string of weak data has sapped confidence in the strength of the U.S. economic recovery, traders and economists said.

On Thursday, weak U.S. employment, manufacturing and housing data backed views that growth in the United States is slowing. Data also pointed to slower Asian and European manufacturing output. [ID:nN01107449] and [ID:nN01123845] and [ID:nSGE66002D]

In Brazil, banks helped pull the Bovespa index .BVSP up 0.49 percent after stocks fell to the lowest since late May early in the session.

State-controlled Banco do Brasil (BBAS3.SA), Latin America's largest bank by assets, shot up 6.13 percent. The bank and shareholders raised 9.8 billion reais ($5.4 billion) on Wednesday in a massive primary and secondary share offering that defied a recent surge in global risk aversion. [ID:nN30263768]

"The rest of the sector is following those shares up," said Homero Guizzo, an economist with LCA consultancy in Sao Paulo.

Itau Unibanco (ITUB4.SA), Brazil's largest private-sector bank by assets, put on 4.65 percent, and Bradesco (BBDC4.SA) rose 4.48 percent.

In Mexico, the IPC stock index .MXX closed up 0.13 percent, snapping a three-session streak of losses and also bouncing back from its lowest intraday level since late May.

America Movil (AMXL.MX), Latin America's largest wireless provider, gained 0.81 percent while retailer Wal-Mart de Mexico (WALMEXV.MX) added 0.45 percent. Miner Grupo Mexico (GMEXICOB.MX) ended down 1.44 percent.

"The really important volume was selling in the morning. The market took a heavy loss and we are coming back, but there is not much appetite to buy," said Mauricio Cervantes, a trader at brokerage Multivalores in Mexico City.

Chile's blue chip IPSA index .IPSA dropped 0.99 percent, weighed down by a 2.47 percent decline in Banco Santander Chile STG.SN. (Additional reporting by Alonso Soto in Santiago; Editing by Kenneth Barry)