Seoul shares inch up as caution rules over U.S. fiscal talks

* Foreign investors turn into net sellers

* Samsung Elec up after heir apparent promoted

SEOUL Dec 5 (Reuters) - Seoul shares rose slightly in morning trade on Wednesday, buoyed by a rise in market heavyweight Samsung Electronics, although sentiment was dampened by stalled talks on the U.S. fiscal standoff.

Foreign investors were net sellers of shares in morning trade after four consecutive days of buying, while institutional investors resumed buying.

The Korea Composite Stock Price Index (KOSPI) ticked 0.28 percent higher at 1,940.51 points as of 0233 GMT.

"Investors will sit on the fence until there is progress in a U.S. fiscal deal," said Jeon Jong-kyu, an analyst at Samsung Securities.

Optimism over the budget negotiations was dented after President Barack Obama rejected a Republican proposal to resolve the crisis and repeated that any deal must include a rise in income tax rates on the wealthiest Americans.

Samsung firmed 0.9 percent after the electronics giant promoted Jay Y. Lee, the anointed heir of the company chairman, to vice chairman on Wednesday.

"Jay Y. Lee has not shown many qualifications as the successor. In my view, he is still learning and does not have a great say, as his father remains at the top," a local fund manger said.

"A leader is important for a company, but Samsung Group is big enough not to be swayed by one individual," he added.

Bank shares rebounded after declines on Tuesday, with KB Financial Group up 1 percent and Woori Finance Corp climbing 1.2 percent

Among smaller-cap stocks, Neowiz Corp and its affiliate Neowiz Games Corp plunged by the daily limit of 15 percent after a media report said their major shareholder Electronic Arts plans to dispose of the entire 27.35 percent stake the U.S. game publisher has in the two South Korean companies.

In contrast, the shares of nTels surged by the daily limit after media reports that Japanese mobile operator SoftBank Corp has invested 1.6 billion Korean won ($1.48 million) in the South Korean firm. (Reporting by Hyunjoo Jin; Editing by Richard Pullin)