By Carla Mozee

Major Latin American equity markets jumped Wednesday, fueled by the prospect that China's expanded economic-stimulus plans will result in higher demand for resources from the region.

Regional equities surged as part of a global rally on word that Chinese Premier Wen Jiabao is considering the launch of more economic-stimulus measures, which would add to China's $585 billion spending plan announced in November.

China is the largest consumer for many industrial commodities.

"It's good news for market participants that the government of one of the three world [economic] locomotives is still alive and trying to drive," said Alfredo Coutino, senior Latin American economist at Moody's Economy.com.

Brazil's Bovespa surged 4.6% to 38,145.17, pulling the index out of negative territory on a year-to-date basis, where it was pushed earlier this week for just the second time in 2009.

Stock in Companhia Vale do Rio Doce (RIO), the largest supplier of iron ore for steel, surged 8.1%, leading advancers among other steel producers. Companhia Siderurgica Nacional (SID) climbed 6.1%, Usinas Siderurgicas de Minas Gerais leaped 7.7% and Gerdau (GGB) rose 5.7%.

Shares of market heavyweight and oil giant Petroleo Brasileiro (PBR), soared 7.6%, as crude for April delivery bounced more than 7% higher to $44.61 a barrel.

Argentina's Merval rose 4.6%, led by a 6.5% jump in shares of Tenaris (TS), which makes steel tubes used by the oil industry.

Chile's IPSA rose 1% to 2,425.94 and Mexico's IPC gained 2.9% to 17,585.47.

Copper miner Grupo Mexico was the session's best price performer with its gain of 11%. Also higher was steel firm Grupo Simec (SIM), with a rise of 6.6% and cement provider Cemex (CX), up 3.8%.

Coutino said while some companies in Mexico may benefit from China's move, nevertheless Mexico's economy will need to see strong economic improvement in the United States, which is the largest buyer of its goods.

"What China needs to do," said Rob Lutts, chief investment officer at Cabot Money Management, "is plug the hole [in its economy] for a period of time until the global economy starts growing. The government appears "to be saying it's willing to step up spend quite a bit on infrastructure, housing, rural reform and environmental" areas.

"Is this the beginning of more healthy growth? That's a question mark that we really can't answer yet," added Lutts.

In exchange-traded funds, the iShares S&P Latin America 40 Index Fund (ILF) rose 5.3% and the iShares MSCI Brazil Index Fund (EWZ) rose 6%.

The market's advance may be halted by Friday, , according to Coutino, after the release of the U.S. employment report, which is expected to show another month of big job losses.

In other market moves, Brazil's Banco Bradesco (BBD) shares moved up 2.2% following a ratings upgrade to buy from neutral by UBS Pactual, which said Unibanco should trade at a premium to its global peers because of "the better quality of its equity and resilient earnings."

UBS Pactual also said Bradesco and Banco Itau (ITU) are attractive after a recent sell-off, which it attributed to weakness in U.S. and European banking stocks.

"Although we believe that there is a positive correlation in financials globally, we think that the sell-off in Brazil is overdone," said wrote UBS analysts Juan Partida and Eduardo Nishio in a note.

The broker added that the newly merged Itau Unibanco continues to be its top regional pick, and expects "signs of synergies" by year's end. Shares of Itau rose 3.2% and Unibanco (UBB) rose 3.5%. The combined company's shares will begin trading on March 31.