Seoul shares flat on U.S. woes; foreign inflows chase record
(Updates to midday)
* KOSPI sustaining 2,040 point mark after touching yr high
* Foreigners on track to tie longest buying streak
* Hyundai Heavy, SK Hynix up on higher earning hopes
* Profit-taking takes down Samsung Elec, Naver, LG Chem
By Jungmin Jang
SEOUL, Oct 16 (Reuters) - The Korea Composite Stock Price Index (KOSPI) edged 0.04 percent lower to 2,040.15 points by 0200 GMT after hitting a year high of 2,049.50 as the funding and debt stalemate in Washington weighed on sentiment.
"With time catching up on Washington lawmakers to strike a deal, investors want to check how everything unravels before taking on risks," said E-Trade Securities analyst Choi Kwang-hyeok.
After debt talks stumbled to drag down Wall Street overnight, a Senate aide said U.S. Senate leaders could announce an agreement soon to reopen the government and raise the country's debt ceiling just hours ahead of the Oct. 17 deadline to lift the government's borrowing limit.
The aide's comments alleviated some of the pressure on the market, but it remained volatile as Fitch Ratings warned it may downgrade the U.S. Government's credit status.
Foreign investors, who positioned themselves to match their longest buying streak, picked up a net 65.2 billion won ($61 million) worth of local shares. It brought their net total for Aug. 23 to the present to more than 11.7 trillion won by Wednesday morning.
The longest foreign net buying streak stands at 34 consecutive sessions which was set from January to March of 1998.
Among local shares that foreigners have favoured during their buying streak, only Hyundai Heavy Industries Co Ltd , SK Hynix Inc and SK Telecom gained this morning.
Hyundai Heavy Industries, the world's largest shipbuilder and an industry bellwether, rose 1.6 percent on an upbeat euro zone survey.
A survey on Tuesday showed economic sentiment in Germany, Europe's largest economy, rose to its highest level in 3-1/2 years at 52.8 in October, adding to tentative signs of a euro zone recovery. Data from a day before indicated output from euro zone factories returned to growth more strongly than expected in August.
Memorychip maker SK Hynix extended its rise on prospects of better earnings on rise in DRAM memory prices, rising 0.9 percent, while SK Telecom rose 1.1 percent on investor defensive play.
Other stocks preferred by foreigners struggled as investors locked in profits. Market heavyweight Samsung Electronics Co Ltd slipped 0.5 percent, while Naver Corp and LG Chem Ltd fell 3 percent and 1.2 percent, respectively.
South Korea's bank sector led all sectors in gains, with KB Financial Group Inc rising 3.9 percent to outperform its sector peers.
Declining shares outnumbered advancing shares 399 to 368.
The KOSPI 200 benchmark of core stocks was flat, while the junior KOSDAQ fell 0.5 percent. ($1 = 1066.8000 Korean won) (Reporting by Jungmin Jang; Editing by Eric Meijer)
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