* China PMI data fuels concerns about pace of economic recovery
* Doosan E&C tumbles on rights issue speculation
By Hyunjoo Jin
SEOUL, Feb 1 (Reuters) - South Korean shares extended falls on Friday after choppy trade, weighed down by China factory data that signalled the rebound in the world's second-biggest economy is shallower than hoped.
Foreign investors continued to dump stocks for a seventh consecutive session, offseting buying by institutional and retail investors.
The Korea Composite Stock Price Index (KOSPI) finished down 0.2 percent at 1,957.59 points.
Two separate versions of China's purchasing managers' index (PMI) showed on Friday that factory output in the world's second-biggest economy rose in January, but the pace of the revival in activity was uneven.
"The latest China data weakened expectations about the pace of its economic recovery," said Park Sung-hoon, an analyst at Woori Investment & Securities.
"But the downside will be limited for the domestic stock market, which is attractive in terms of valuations, after having underperformed the U.S. and other markets," he said.
Auto shares continued to gain as the South Korean won hit its lowest levels in over three months against the dollar on Friday. Hyundai Motor rose 0.7 percent and Kia Motors climbed 0.6 percent.
Hyundai joined Kia Motors in reporting double-digit sales growth for January after the closing bell.
Builders slipped after speculation that Doosan Engineering & Construction may issue new shares re-ignited jitters about the sluggish housing market. The builder was asked by the bourse operator to clarify market rumours by 0900 GMT.
Doosan Engineering & Construction dived 11 percent, while its top shareholder Doosan Heavy Industries and Construction slumped 8.1 percent.
Defensive, domestic-focused stocks defied market falls, with Korea Electric Power firming 2.6 percent and Korea Gas up 0.2 percent.
Among heavyweights, Samsung Electronics declined 0.5 percent, while POSCO gained 1 percent.
Move on day -0.21 percent
12-month high 2,057.28 14 March 2012
12-month low 1,769.31 25 July 2012
Change on yr -1.97 percent
All-time high 2,231.47 27 April 2011
All-time low 93.10 6 January 1981 (Reporting by Hyunjoo Jin; Additional reporting by Seong-won Chang; Editing by Jacqueline Wong and Eric Meijer)