Seoul shares down

Seoul shares fell 0.7 percent on Monday as uncertainty over US and European debt issues continued to weigh on the market and dampened the earnings outlook for large caps such as Samsung Electronics and steel firm POSCO. The number of gainers, however, outnumbered decliners by some 110 counters as retail investors snapped up medium to small cap stocks.
"Uncertainties over the US and European debt issues are keeping foreign investors more risk averse and leading them to reduce exposure to Korean stocks," said Lee Jae-man, an analyst at Tongyang Securities. "Their appetite for domestic stocks is unlikely to return until those uncertainties are cleared, keeping pressure on the KOSPI."
The Korea Composite Stock Price Index closed down 0.69 percent at 2,130.48 points. KOSPI 200 September futures fell 3.35 points to 277.35 and the KOSPI 200 spot index shed 2.88 points to 276.71. The junior Kosdaq market finished up 2.16 percent at 517.93.
Foreign investors were net sellers for a fifth successive session on Monday, offloading a net 211 billion won ($199 million) worth of stocks and pressuring their favourite large cap picks.
Shares in the world's top memory chip maker Samsung Electronics dropped 2.3 percent and its rival Hynix Semiconductor Inc fell 4.4 percent, also pummelled by depressed chip prices.
Contract prices of DRAM (dynamic random access memory) chips dropped 8 percent in the first half of this month and manufacturers may have to reduce output for the first time since the global financial crisis in 2009, according to price tracker DRAMeXchange. POSCO sank 3.3 percent amid concerns that profits would decrease in the current quarter due to higher input costs and worsening demand outlook for steel.
Samsung Life Insurance Co, the country's biggest life insurer, was a rare bright spot among blue chip issues. The stock jumped 3 percent after the firm said it would buy back 3 million shares worth $269 million to boost its sagging share price.
It is the firm's first share purchase since it went public in May last year and its shares have dropped nearly 20 percent since. Shares in Daekyung Machinery & Engineering jumped 9 percent, helped by take-over interest from Daewoo Shipbuilding & Marine Engineering.
Both companies told the stock exchange nothing has been decided on the potential transaction yet. Daekyung has jumped for three successive sessions, gaining more than 40 percent. Deposits for stock investment hit a 52-week peak of 17.6 trillion won last week and continue to stay high as retail investors kept pouring money into the market, making up for five consecutive sessions of net selling by foreign investors.
Individual investors chased domestic-focused stocks such as retail, medical, and leisure counters. E-Mart Co , the country's biggest discount store chain, jumped 7.7 percent after Daewoo Securities raised its target price, citing strong growth expected from new businesses online shopping mall Emart Mall and warehouse-type discount store Emart Traders.
Paper producer Moorim P&P jumped 12 percent after it reported its second-quarter net profit leaped nearly four fold to 10.4 billion won from the previous quarter. The stock led the paper & wood sub-index 3.8 percent higher. Electronics goods retailer Himart , which has struggled to stay above its initial public offering prices since its June 29 listing, gained 4.2 percent after it said second-quarter net profit more than doubled from a year ago.