By Carla Mozee (MarketWatch.com)

Brazil's Bovespa fell 2.1% to 58,175.42, with just a handful of stocks advancing.

Interest-rate policymakers in a unanimous decision Wednesday evening raised the country's key rate by 75 basis points to 13%, as it moved to curb rising inflationary pressures.

Economists had widely expected the benchmark Selic rate to be raised by 50 basis points.

Prices for resources remain at historically elevated levels, though prices for oil, grains and other commodities have moved off peaks levels in recent sessions.

Regional equities "have been weak in sympathy with oil and resources. So this [rate hike] is a double whammy," said Bruce Zaro, chief technical analyst at Delta Global Advisors.

Banking stocks fell. Unibanco (UBB) and Banco Itau (ITU) each lost 3%, Banco Bradesco (BBD) dropped 2.4% and state-run Banco do Brasil shed 1%. Home builder Gafisa (GFA) lost 2.6% while Rossi Residencial was fractionally lower.

Following the rate hike, the Brazilian real touched a nearly 9-year high against the dollar, at 1.574. The dollar has lost roughly 12% against the real year-to-date.

The climb put pressure on exporters. Steel companies were hit hard, led by a 5.4% decline in shares of Gerdau (GGB). Usiminas slid 4.8% and CSN (SID) was down 4.1%.

Shares of the heavyweight and mining firm Vale (RIO) fell 2.5%, and oil gaint Petrobras (PBR) fell 2.4%, though crude-oil prices rose more than 1% to nearly $126 a barrel.

In April and June, the Selic was lifted by half a percentage point. Consumer prices on an annualized basis are running above the country's inflation target of 4.5%.

A survey released earlier this week by the central bank showed that economists expect inflation to climb to 6.53%, above the upper limit of the central bank's target of 6.5%.

"Central bankers, to some extent, are really hemmed in with the fast-growth economies. They really need to reign in inflation," said Zaro.

In Mexico, consumer prices in the first half of July rose 0.38%, pulling inflation on an annualized basis to 5.37%, compared with 5.26% in June, according to the central bank Thursday. The reading would support a decision by the Bank of Mexico to raise interest rates.

The IPC index fell 1.2% to 27,296.07, with equities also strained by worries about weakness in the U.S. economy after the National Association of Realtors reported sales of existing homes in June fell to their lowest level in a decade.

In recent action, just six of the 35 stocks on the benchmark index moved higher.

Retailer Wal-Mart de Mexcio (WMMVY) picked up 0.2% brewer Groupo Modelo rose 1.7% and Banorte (MX:GFNORTEO) rose 0.1%