* Most Latam stocks gain * Brazilian bank stocks drop after report of higher taxes * Real nonplussed by central bank intervention (Adds details, updates prices) By Susan Mathew and Ambar Warrick March 2 (Reuters) - Brazil"s real sank to a four-month low on Tuesday after government action to curb fuel prices raised concerns over a shift to populist policies, while other Latin American currencies remained on edge over high bond yields. The real plunged 1.4% after President Jair Bolsonaro said he would issue a decree on Tuesday suspending a tax on diesel fuel, a move aimed at placating truckers who had threatened to strike. Sources also told Reuters the government would instead hike taxes on banks" net income to about 23% from 20% to offset lost revenue. Shares in some of the country"s biggest banks, such as Itau Unibanco, Bradesco and Banco Santander Brasil, lost between 0.1% and 1%, while the Bovespa stock index was subdued, having touched a more than three-month low in the session. Brazil"s central bank intervened in the spot foreign exchange market for the fifth time in four days on Tuesday to support the currency, which was last trading at 5.68 per dollar. Fears of populist policy measures have risen since Bolsonaro ousted state-run oil company Petrobras" chief executive in February over disagreements on fuel prices, and threatened to interfere in other sectors of the economy. "The overall news flow since last week has not be conducive for a positive price action in (Brazil) markets," said Latam strategists at Citi Research. "Investor optimism will remain suppressed after the government"s meddling to prevent a rise in fuel prices, and the potential dilution of compensatory measures in the emergency bill. Thus, we have a negative bias for asset prices in the short-term." Brazil"s government is considering extending an emergency coronavirus aid program amid worries of breaching the government"s spending cap - an issue that has weighed on Brazilian assets. Concerns over a local variant of the coronavirus have also undercut Brazilian assets recently, with scientists warning that it can re-infect people who have previously recovered from the disease. Most other currencies in Latin America fell against a steady to higher dollar, in line with broader emerging market peers as concerns over spiking bond yields persisted. Chile"s peso dropped 0.9%, while Colombia"s peso shed 1%. Emerging market stocks and bonds saw foreign net inflows of about $31.2 billion in February, though rising U.S. interest rates triggered a slowdown during the last week, data from the Institute of International Finance showed on Tuesday. Still, other Latam stocks recovered from recent losses, with equities still being seen as most primed to benefit from an economic recovery this year. Key Latin American stock indexes and currencies: Latest Daily % change MSCI Emerging Markets 1362.23 -0.02 MSCI LatAm 2225.75 -0.46 Brazil Bovespa 110191.37 -0.13 Mexico IPC 45722.51 2.09 Chile IPSA 4706.93 1.5 Argentina MerVal 48144.56 -1.738 Colombia COLCAP 1350.41 -0.39 Currencies Latest Daily % change Brazil real 5.6817 -1.42 Mexico peso 20.6375 0.01 Chile peso 728.7 -0.93 Colombia peso 3654.5 -1.00 Peru sol 3.6657 -0.27 Argentina peso 90.1500 -0.07 (interbank) (Reporting by Susan Mathew and Aaron Saldanha in Bengaluru; Editing by Jane Merriman and Jonathan Oatis)