(Updates with peso close)

By Alexia Vlahos

SANTIAGO, June 15 (Reuters) - Chile's leading share index fell sharply on Monday, tracking losses on foreign markets, as investors took profits after gains that last week propelled the bourse to its highest level since December 2007, traders said.

In currency trading, the peso fell as the U.S. dollar rose.

The blue-chip IPSA index .IPSA fell 1.46 percent to 3,205 points, while the all-market IGPA index .IGPA was down 1.21 percent at 15,261 points.

"All stock markets in Europe and the U.S. are falling a lot today," said Pamela Auszenker, head of research at the Bci brokerage. "Commodities have been falling hard globally, and that obviously impacts Chile."

Copper for July delivery fell 3.7 percent in New York to $2.285 per pound.

Wall Street's Dow Jones industrial average .DJI fell more than 2 percent as natural resource shares weakened and regional manufacturing data dented optimism over the economy's health.

The IPSA, which is up around 35 percent year-to-date, rose around 16 percent in May, when it posted its biggest gain in a single month since January 1994.