Fed tapering helps Seoul shares rise 0.5 pct
(Updates to midday)
* Foreigners net-buying bolsters the index
* Capital inflow expected to continue - analysts
* Samsung Elec, Naver Corp chased higher by foreigners
SEOUL, Dec 19 (Reuters) - Seoul shares joined global markets in rising early Thursday after U.S. Federal Reserve announced it would start to unwind its stimulus programme.
The U.S. central bank said it would reduce its monthly asset purchases by $10 billion to $75 billion, while it also indicated that its key interest rate would stay at rock bottom even longer than previously promised.
The Korea Composite Stock Price Index (KOSPI) was up 0.5 percent at 1,984.27 points by 0215 GMT after hitting an intraday high of 1,997.02, its highest since Dec. 11.
With the Fed's tapering decision, "flow of foreign capital is the focus of the market in absence of variables," said Lee Eun-taek, an analyst at Dongbu Securities.
Analysts said the firming of the dollar against the won will strip away foreign exchange profit for offshore investors, but local stocks remain attractive enough to bolster foreign appetite.
"Tapering isn't tightening, so there are plenty of opportunities to lure foreign investors," said Samsung Securities analyst Kim Yong-goo. "Of course South Korean stocks aren't as sexy as U.S. and Japanese stocks, but they still stand out from other emerging market stocks."
Foreign investors were net buyers of 70.4 billion won ($66.97 million) of local shares near mid-session. Popular with them were Samsung Electronics Co Ltd and Naver Corp , which advanced 1.9 percent and 2.4 percent, respectively.
Hopes for a rise in commercial interest rates, following the Fed's tapering, lifted the banking sector. Woori Finance Holdings Co Ltd rose 2.4 percent and Shinhan Financial Group Co Ltd 1.3 percent.
Bucking Thursday's trend were autoparts makers, with Mando Corp and Hyundai Mobis Co Ltd tumbling 6.5 percent and 3.1 percent, respectively.
Crude oil refiner S-Oil Corp fell 1 percent after a local newspaper reported that Hanjin Group is planning to sell all 28.4 percent of S-Oil shares worth 2.3 trillion won for improvement in financial structure.
Advancers outnumbered decliners 447 to 315.
The KOSPI 200 benchmark of core stocks was up 0.6 percent, while the junior KOSDAQ edged up 0.2 percent. ($1 = 1051.2500 Korean won) (Reporting by Jungmin Jang; Editing by Richard Borsuk)