* U.S. Treasury yield rise leads to tighter spreads

* LatAm stocks and currencies mixed

* Peru cuts interest rates 100 basis points to 3 pct

By Daniel Bases

NEW YORK, June 5 (Reuters) - Emerging markets were mixed on
Friday, getting a modicum of support from slightly stronger
U.S. stocks but undercut by weak commodities and a sharp drop
in U.S. Treasuries.

Latin American currencies weakened against a broadly
stronger U.S. dollar after American jobs data showed fewer
people were newly unemployed last month, boosting hopes for an
economic recovery.

MSCI's Latin American stock index .MILA00000PUS fell 0.38
percent but the broader MSCI emerging markets stock index
.MSCIEF climbed 0.67 percent on Friday.

Yield spreads between U.S. Treasuries and emerging market
sovereign bonds tightened however as a result of investors
dumping the safe-haven asset on concerns the better jobs report
would prompt the U.S. Federal Reserve to consider raising
interest rates.

The JP Morgan Emerging Markets Bond Index Plus
11EMJ.JPMEMBIPLUS narrowed by 11 basis points to 419 basis
points over U.S. Treasuries. The benchmark 10-year U.S.
Treasury yield nudged up to the 3.85 percent area US10YT=RR.

"It has been building for a couple of weeks now. LatAm has
been avoiding coming to the crude truth of higher (U.S.)
Treasury yields. It has been too caught up in the recovery and
high commodity price landscape that has been reigning in Latin
America," said Enrique Alvarez, head of Latin American debt
strategy at IDEAglobal in New York.

Alvarez says Latin American debt prices may have hit a peak
and are now adjusting to higher U.S. Treasury rates, he said.

Among benchmark issues, Brazil's 2040 Global bond
BRAGLB40=RR fell 0.38 points in price to bid 129.063,
yielding 5.407 percent.

Even as there are elements of economic recovery in data
from the U.S. and elsewhere, interest rates in emerging markets
continue to decline.

The latest Reuters poll of economists expects Brazil to cut
its benchmark Selic interest rate to a record low of 9.50
percent on June 10 BRCBMP=ECI. The government's expected 75
basis point cut in borrowing costs would be its latest effort
to nurture economic growth amid the global recession.

Peru continued to take an axe to its interest rate levels,
cutting 100 basis points off its benchmark rate to 3 percent.
This marks the fifth straight monthly reduction in rates.

BullTick Capital Markets senior emerging market
macroeconomic strategist, Kathryn Rooney wrote on Friday the
firm expects Peruvian inflation to fall within the 1-3 percent
target range this year due to lower food and metals prices.

"This, in addition to a significantly widening output gap
and other world central banks pushing down rates at a rapid
clip, gave the BCRP room and incentive to cut rates more than
expected: indeed, Peru has the capacity to push rates down to
2.0 percent in our view, by the end of the year," she wrote.
(Reporting by Daniel Bases; Editing by Diane Craft)