By Carla Mozee

Major Latin American equity markets were mixed, with one of Brazil's market heavyweights slumping as oil prices fell, while Mexican stocks clung to gains after the country posted a rise in monthly industrial output.

Brazil's Bovespa, tracking the largest stock market in the region, fell 0.6% to 71,003, and was on track for a second straight session of losses. The index rose 0.4% last week, and is up 3.5% this year.

Shares of Petroleo Brasileiro (PBR), the state-run oil giant, fell 1.6%, following the direction of oil prices on concerns about a potential increase in stockpiles this week. Crude oil for May gave up earlier gains to trade down 0.1% to $84.88 a barrel on the Comex division of the New York Mercantile Exchange.

Separately, Petrobras' shares were downgraded to market perform from outperform by Bernstein, according to Briefing.com.

Meanwhile, the company's chief executive, Jose Sergio Gabrielli, reportedly said on Monday that Petrobras is still planning to sell new shares before the first half of this year ends. The company aims to invest up to 250 billion reals in 2011 through 2014 to develop the pre-salt oil region in offshore Brazil.

Brazilian lawmakers are currently discussing a plan that would give the government greater control over the country's huge reserves in exchange for a bigger stake in Petrobras.

The Bovespa was also weighed by losses among steel, utility, finance and communication stocks.

Mexico's IPC index rose 26 points to 33,867, but was off its highest levels of the session. Earlier Monday, the country's statistics agency said industrial output in February rose 4.4% compared with the year-ago period, the third consecutive month of increases. Industrial manufacturing climbed 8.8% and mining activity rose 2.3% while oil output fell 1%.

The reading fell shy of the 4.6% forecast by analysts surveyed by Dow Jones Newswires. Output rose 0.59% on a seasonally adjusted basis from January.

In Mexico City, shares of conglomerate Grupo Carso rose 0.7%. Retail and finance stocks were higher, but shares of miners, communications firms and some consumer discretionary stocks moved lower.

The IPC finished at a record high on Friday.

Chile's IPSA slipped 0.1% to 3,838 while Argentina's Merval edged up 1 point to 2,511.

Among exchange-traded funds, the iShares MSCI Chile Investable Market Index fund (ECH) fell 0.6%. The iShares MSCI Mexico Index fund (EWW) slipped fractionally and the iShares MSCI Brazil Index fund (EWZ) fell 0.7%.