SEOUL, July 27 (Reuters) – Seoul shares were mixed on Tuesday after gains among automakers such as Hyundai Motor (005380.KS) were offset by declines in Hynix (000660.KS) and other technology stocks after the index reached a new 2-year high.
The Korea Composite Stock Price Index (KOSPI) ended 0.04 percent lower at 1,768.31 points, after earlier rising to 1,778.72 points, a fresh 25-1/2-month closing high.
“Investors are acting more cautiously at the index’s current level as economic uncertainties still exist,” said Hong Soon-pyo, an analyst at Daishin Securities, noting that declines in U.S. index futures were added pressure.
Confidence among big South Korean firms fell to a one-year low for August due to an uncertain economic outlook. A consumer sentiment index paused in July after setting a five-month high in June, because incomes have been lagging the rapid economic growth. [ID:nTOE66P08D]
Domestic institutional investors were sellers of a net 294 billion won ($246.8 million) worth of stocks.
Technology issues declined amid a selling spree to lock in profits on their recent sharp gains and due to a cautious earnings outlook for the second half.
Shares in Hynix (000660.KS) declined 1.9 percent despite a successful block sale of its stake by shareholders.
Shareholders of Hynix sold 584.4 billion won ($490.7 million) in shares, or a 4.1 percent stake, in the world’s No. 2 memory chipmaker at Monday’s closing price of 23,950 won. [ID:nSEU003102]
The company’s shares have risen more than 40 percent so far this year.
“There are concerns about its fourth quarter performance due to chip prices,” said Hwang Yoo-shik, an analyst at SK Securities.
Shares in Samsung SDI (006400.KS) fell 0.6 percent after its second quarter profit rose by a third.
“There are worries within the market the momentum of demand for electronic components will not catch the usual peak season between August and October,” said Kiwoom Securities analyst Kim Byung-ki.
Samsung SDI shares have risen nearly 70 percent so far in 2010.
Automakers advanced on upbeat hopes about their earnings and new models, analysts said. Shares in Hyundai Motor (005380.KS), South Korea’s top automaker, rose 2.5 percent and Kia Motors (000270.KS) gained 0.2 percent.
“Hyundai Motor is set to unveil the new Avante next month, and the new model is expected to further boost Hyundai’s already solid earnings performance,” said Ko Tae-bong, an analyst at IBK Investment & Securities.
Shares in Daewoo Engineering & Construction (047040.KS) declined 1.9 percent after posting an 86 percent drop in second quarter net profits to 22.5 billion won.