Mercado edged Dessel in a sprint at the finish of the 190.5-kilometer 10th stage in Pau, France, in four hours, 49 minutes and 10 seconds, but Dessel's performance put him into the overall race lead 2 minutes and 34 seconds ahead of Mercado.
Serhily Honchar of Ukraine, who began the day wearing the yellow jersey of overall leader, finished the Tour's first mountain stage more than 7 minutes behind the leaders to fall to third overall, 3 minutes, 45 seconds behind Dessel.
Cristain Moreni of Italy was fourth overall and American Floyd Landis was in fifth place overall.
Stage 11 winds 206.5-kilometers from Tarbes to Val d'Aran Pla-de-Beret in the Pyrenees of southwest France on Thursday.
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