Chilean stocks tumble on profit taking, peso up

(Updates to market close)

By Aaron Nelsen

SANTIAGO, Oct 28 (Reuters) - Chile's benchmark IPSA stock index tumbled on Wednesday, in line with falling bourses worldwide and on profit taking, analysts said.

Chile's benchmark IPSA index .IPSA extended its recent skid, falling 1.5 percent to 3,321.75, while the all-market .IGPA closed 1.3 percent lower to 15,669.73.

"The local market tracked closely with foreign exchanges, moving up and down almost simultaneously," said William Baeza, financial analyst with Euroamerica Corredores brokerage. "This can also be attributed to a short-term correction on investor profit taking."

There is growing concern that gains on Chile's stock market are limited through the end of the year. However, with several companies yet to report third-quarter earnings there could be a few surprises ahead, Baeza said.

The IPSA fell on a host of stocks, including a 3.4 percent drop by Banco Santander Chile STG.SN, Chile's No.1 private bank, closing at 27.51 pesos.

Soquimich SQM_pb.SN, the leading exporter of fertilizer and the world's biggest producer of iodine and lithium, fell 2 percent to close at 19,475 pesos.

Chilean retailer La Polar LAP.SN, fell nearly 3 percent to close at 2,652.40 pesos.