Seoul shares pull back from seven-month high

Seoul shares fell on Monday as investors cashed out following last week's gains, with liquidity-driven momentum seen stalling on the lack of further evidence pointing to firmer growth and wariness that expiring options may trigger further correction. The Korea Composite Stock Price Index (KOSPI) dipped 0.91 percent to close at 2,016.06 points, pulling back from a seven-month closing high set on Friday and snapping a three-day winning streak.
"Institutions have once again viewed a ceiling at the current level and booked profits, while foreign investors turned into net sellers and failed to provide support. Whether or not offshore bids will return to strength as before should depend heavily on oil prices," said Kim Hak-gyun, an analyst at Daewoo Securities. Refiners and petrochemicals shares, battered in recent sessions by surging oil prices, tumbled yet again on Monday as LG Chem, South Korea's largest chemical maker, fell 4.83 percent while SK Innovation, the country's largest crude refiner, shed 2.96 percent.
Institutions snapped a three-day buying streak to dump a net 145.6 billion won worth of shares, booking profits at a resistance line near the 2,050 mark. The benchmark index has now formed a double-top pattern after a similar rise in late February failed to top that key chart level and triggered a series of corrections. Large-cap technology shares, popular with offshore investors and standout performers in recent weeks having breached many key milestones, turned lower on profit-taking as foreigners turned into net sellers, dumping a net 58 billion won ($52 million) worth.
Samsung Electronics slid for a second straight session after closing at an all-time high on Thursday, drifting 0.68 percent lower, while Hynix Semiconductor shed 1.31 percent to pull back from a nine-month closing high set on Friday. Despite a string of positive US economic data fostering hopes of recovery in the world's largest economy, China's bumpdown of its 2012 growth target to 7.5 percent has raised concerns of weakening global demand, depressing sentiment which is weighing especially on growth-related shares. Shipbuilders lagged, as Daewoo Shipbuilding & Marine Engineering slid 3.74 percent while Samsung Heavy Industries declined 2.09 percent. The KOSPI 200 index closed 1.01 percent lower while the junior KOSDAQ shed 0.78 percent.