Chile stocks, peso close up on commodity prices

(Adds closing prices)

SANTIAGO, Aug 21 (Reuters) - A rebound in commodity prices such as copper helped Chilean stocks close higher in afternoon trade on Thursday, but rising oil prices kept most issues in check, while the peso gained against the dollar.

The all-market IGPA stock index .IGPA closed up 0.33 percent to 13,492.38 points, while the blue-chip IPSA .IPSA rose 0.52 percent to 2,839.65 points.

Rising issues included steel and iron ore producer CAP CAP.SN, which recently initiated an expansion drive valued at close to $4 billion. Stock in CAP rose 3.77 percent to 17,800 pesos per share.

Shares of Chilean leading fertilizer exporter Soquimich SQM_pb.SN, which also recently announced major investment plans, rose 5.03 percent to 19,590 pesos per share.

"What's rising here are stocks related to commodities, which are pressuring the market upward," said Roberto Guzman, head of investment at the FIT Research brokerage in Santiago.

Chile is the world's top copper producer.

Another winning issue on Thursday was retailer La Polar LAP.SN, whose stock rose 4.05 percent to 1,915 per share.

Competitor D&S DIS.SN, however, fell 0.8 percent to 199.89 pesos per share after UBS Pactual cut its rating to "neutral" from "buy," citing lower-than-expected same-store sales.

Chile's peso gained against the dollar on Thursday after hitting a seven-week low a day earlier.

The peso CHILJ <CLP=CL> closed 0.31 stronger at 521.20/521.50 per dollar compared to Wednesday's close of 522.80/523.30.

The local currency has weakened around 17 percent since the central bank introduced an $8 billion intervention program in April to curb a sharp appreciation of the local currency earlier in the year. (Reporting by Manuel Farias; writing by Pav Jordan; Editing by Chizu Nomiyama)