Shares fall on foreign selloff

South Korean stocks closed 0.6 percent lower Tuesday as foreigners snapped a 12-day buying streak to opt for profit-taking, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index slid 12.03 points to finish at 1,991.41. Trading volume was moderate at 523.9 million shares worth 4.55 trillion won ($4.06 billion) with decliners outpacing advancers 570 to 257.

“Foreigners chose to take profits, but the amount is not big, meaning that they are still sitting on the sidelines with the impact from the global stimulus measures yet to be felt,” said Bae Sung-young, an analyst at Hyundai Securities Co.

Offshore investors unloaded a net 86.4 billion won, reverting to net sellers for the first time since Sept. 7. They bought more than a net 3 trillion won worth of local stocks in the last 12 sessions. The Seoul bourse gained 6.5 percent in that period.

Analysts said although Tuesday’s foreign selloff stems largely from investor appetite for profit-taking, it reflects market disappointment over tepid effects of monetary stimuli from the United States, Europe and Japan.

“The central banks’ policy to inject liquidity through bond purchases is not spilling over into the real economy sector because lenders have no place to invest the money with,” said Jun Min-kyu at Korea Investment & Securities Co.

Most shares trended in negative territory, with machineries and retail issues driving the index down. Heavy equipment maker Doosan Infracore dipped 2.06 percent to 19,000 won and discount store chain Emart sank 2.8 percent to 243,000 won.

Tech blue chips finished bearish. LG Electronics slumped 5.42 percent to 69,800 won and SK hynix fell 2.55 percent to 22,900 won.

Market behemoth Samsung Electronics closed flat at 1,327,000 won. (Yonhap News)