By Carla Mozee

Mexican and Argentine equities jumped Monday, leading advancers in Latin America as investors returned from a two-session break to ride gains in the region and on Wall Street.

Mexico's IPC climbed 6.4% to surpass the "psychological" level of 21,000 points, according to Vector Casa de Bolsa on Monday. The index ended at 21,838.96, its best closing level since Jan. 13.

Gainers were led by a 13% jump in shares of home builder Homex (HXM) and a 11% climb in shares of baked good maker Grupo Bimbo.

Banking stocks were also up strongly, with Grupo Financiero Inbursa up 5.2% and Grupo Financiero Banorte higher by 9.1%. Investors are looking to Friday's interest-rate decision by the Mexican central bank, which is expected to cut to lower the key rate by 50 basis points to 6.25%, according to a Dow Jones survey of analysts.

Argentina's Merval surged 5.9% to 1,195.38.

Trading was closed Thursday and Friday in Mexico and Argentina ahead of the Easter holiday. The IPC finished the shortened week down 1.9%, and the Merval fell 2.8%.

In Santiago, locally listed shares of Brazilian oil heavyweight Petrobras on Monday rose 5.1% and stock in its Argentina-based unit, Petrobras Energia (PZE) rose 3.7% despite a drop in crude prices.

Shares of Tenaris (TS), maker of steel tubes used by oil companies, jumped 8.7%.

In Sao Paulo, shares of oil giant Petrobras (PBR) slipped 0.2%.

The gains in most regional oil and oil-related issues came despite a 4.3% decline in crude prices to $50 a barrel. Oil for May delivery had lost more than 6% during the session after the International Energy Agency cut its forecast for global oil demand by 1 million barrels a day. The forecast is for 83.4 million barrels a day, down 2.4 million barrels a day below the level in 2008.

A jump in metals prices helped lift most metals stocks in Brazil. Companhia Vale do Rio Doce (RIO) gained 2.4%, Gerdau (GGB) rose 3.3% and CSN (SID) rose 2.5%. But Usiminas finished down 0.6%.

The standout metal was copper for May delivery, up 2.8% to $2.13 a pound to finish at its highest level since October "as falling inventories and signs of economic recovery in China suggested a brighter demand outlook," said BMO Capital Markets analyst Bart Melek in his global commodity-strategy note released Monday.

In Mexico, shares of copper miner Grupo Mexico rose 4.8%.

Anticipation that China's efforts to revive its economy will help pull the global economy out of recession have bolstered many markets in countries rich with natural resources.

"Investors are also speculating that record Chinese money-supply growth, surging credit creation and possible additional stimulus may cause inflation, prompting Chinese capital to use copper as a hedge," Melek wrote.

He cautioned that the rally in copper is "somewhat overdone," and that a correction will arrive in the coming weeks and months, though a decline isn't likely to test recent lows.

"As for using copper as a hedge against inflation and the dollar, it tends not to work out too well when supply/demand conditions are convincingly tilted toward oversupply," the analyst said.

Elsewhere in Brazil, stock in Tam (TAM) and Gol (GOL) rose after regulatory data showed domestic air-traffic volume rose 3.6% in March. Tam shares surged 11% and Gol gained 4.7%.

The benchmark Bovespa index rose 1% to 45,991.89. In Chile, the IPSA gained 2% to 2,636.51.