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By Ricardo Brito

BRASILIA (Reuters) - Brazil's Jair Bolsonaro suffered the heaviest blow to his presidency so far as his popular justice minister quit on Friday and accused him of potentially criminal meddling in law enforcement, adding to the turmoil of a government struggling to confront a fast-growing coronavirus outbreak.

Sergio Moro, who won broad public support for jailing corrupt politicians and businessmen as a judge, said he was resigning because Bolsonaro fired federal police chief Mauricio Valeixo for personal and political reasons.

The shocking exit and allegations from the so-called 'super minister' were a hammer blow for Bolsonaro, whose popularity had already slumped for downplaying the pandemic that has killed more than 3,600 Brazilians and shows signs of worsening.

Bolsonaro called Moro's accusations "baseless," denying he had interfered in investigations and insisting that he had the authority to replace federal police officials.

"The appointment is mine, the prerogative is mine and the day I have to submit to any of my subordinates I cease to be president of the republic," Bolsonaro said in a public address, flanked by most of his cabinet in the presidential palace.

Moro's accusations spurred outcry from across Brazil's political spectrum, with former President Fernando Henrique Cardoso urging Bolsonaro to step down.

Brazil's chief public prosecutor Augusto Aras asked the Supreme Court to open an investigation into the allegations.

Brazilian financial markets tumbled, with stocks falling nearly 10% before paring losses to 5.5% and the exchange rate slipping to a record low. Investors fear Economy Minister Paulo Guedes may be the next 'super minister' to exit.

Moro said Bolsonaro had expressed concern about Supreme Court investigations, without giving further details, and he wanted inside information from his top cop.

"The president emphasized to me, explicitly, more than once, that he wanted someone who was a personal contact, whom he could call, from whom he could get information, intelligence reports," Moro said. "And really, that's not the job of the federal police to give that information."

Capitao Augusto, head of the gun lobby in Congress that has been key to the president's threadbare coalition, said this was the "beginning of the end" for Bolsonaro.

"His position is becoming more and more untenable," Augusto told Reuters, adding that a parliamentary investigation was certain. "I think that after this pandemic, the first topic that will be debated will be the question of the impeachment of the president."

The head of the Brazilian bar association OAB, Felipe Santa Cruz, also said the organization would "analyze the alleged crimes highlighted by Moro."

During the televised remarks by Moro and the president, protests rang out across Brazil, with people banging pots and pans from their apartments and shouting "Bolsonaro out!"

LOSING ALLIES

Moro's exit may alienate voters who backed Bolsonaro for his anti-corruption campaign in 2018, leaving the president reliant on conservative social activists, lawmakers interested in pork-barrel politics, and current and former generals in his cabinet.

"The exit of minister Sergio Moro from the government shows the Bolsonaro government distancing itself from the popular desire to fight corruption. It is the defeat of ethics," the centrist Podemos party said in a statement.

The crisis comes a week after Bolsonaro fired popular Health Minister Luiz Henrique Mandetta, following clashes over how to tackle the coronavirus outbreak. Mandetta, like most health experts, had supported social distancing orders by Brazilian governors, but Bolsonaro called the measures "poison" whose economic consequences could kill more than the virus.

Brazil has registered 357 coronavirus deaths in the last 24 hours, the Health Ministry said on Friday, taking the death toll to at least 3,670 as confirmed cases rose to nearly 53,000.

"We're seeing the government come apart," said Fernando Bergallo, head of currency trading at FB Capital. "There are rumors that the next to go is Paulo Guedes. With that, the government is finished."

The Economy Ministry did not respond to a request for comment. Guedes appeared with other ministers alongside Bolsonaro during his address.

In his parting remarks on Friday, Moro said he had agreed to serve in Bolsonaro's government as long as he had free rein to appoint personnel without political pressure. However, he said Bolsonaro had been seeking to change the top federal police officer since the second half of 2019 without good reason.

Bolsonaro said he had offered his ministers autonomy, but that he had veto power over decisions in his government. He had been open, he said, to a compromise with Moro about the police chief replacement.

"I don't need to ask permission to change a director or anyone else in the hierarchical pyramid of the executive branch," the president said, adding that he never made inappropriate inquiries or suggestions about police cases.

"I never asked the status of any case," he said.

But Moro alleged he had never seen political interference of the kind sought by Bolsonaro over Brazil's federal police, even under previous governments whose officials and allies were convicted of participating in sweeping corruption schemes.

For four years, Moro oversaw Brazil's largest-ever corruption probe, which uncovered billions of dollars in bribes and jailed scores of powerful businessmen and politicians, including leftist former President Luiz Inacio Lula da Silva.

"The president is digging his pit. Resign before being resigned," former President Cardoso said on Twitter. "Let the vice-president take over."

(Reporting by Ricardo Brito; Additional reporting by Maria Carolina Marcello, Marcela Ayres, Isabel Versiani, Anthony Boadle and Lisandra Paraguassu in Brasilia, Eduardo Simoes and in Sao Paulo, Rodrigo Viga Gaier in Rio de Janeiro; Writing by Gabriel Stargardter and Stephen Eisenhammer; Editing by Brad Haynes, Angus MacSwan and Richard Chang)