Seoul shares hit 1-week high on U.S. data, earnings eyed
* Foreigners net buy, poised to halt net selling streak
* Defensives rise before earnings season kick-off
SEOUL Jan 16 (Reuters) - Seoul shares nudged higher to a one-week high on Thursday morning after upbeat U.S. data reassured investors about the growth outlook in the world's largest economy, though buying was tempered ahead of the earnings season.
The Korea Composite Stock Price Index (KOSPI) was up 0.3 percent at 1,959.06 points as of 0218 GMT after hitting an intraday high of 1,965.27, its highest since Jan. 8.
"Firm data are pointing to improvement in the U.S. economy, assuring that its strength will guide emerging markets higher," said Ko Seung-hee, a market analyst at SK Securities. "However, buying and selling volumes are thin as investors want to check up on corporate results."
Latest U.S. data showed that seasonally adjusted Producer Price Index rose 0.4 percent in December, the biggest increase since June, although inflation pressures remained benign. Meanwhile New York Federal Reserve Bank's "Empire State" index of general business conditions climbed to its highest level in 20 months.
Analysts expect the market to experience a testing time as local brokerages continue to downgrade their corporate earnings forecasts for the October-December quarter, and subsequent quarters due to the yen's sharp slide in recent months.
The yen's weakness against the won has eroded Korean exporters' competitiveness abroad, giving their Japanese rivals an edge.
Stocks of Food & beverage companies rose as investors rotated into defensive plays before the earnings season gets into full swing next week. Binggrae Co Ltd gained 1.4 percent and CJ Cheiljedang Corp added 1.3 percent.
Net foreign buying, which was absent in the previous four sessions, supported the main bourse with net purchase of 34.5 billion won ($32.5 million) worth of KOSPI shares.
Market heavyweights Hyundai Motor Co and Naver Corp advanced 1.1 percent and 3.5 percent, respectively.
Hyundai Heavy Industries Co Ltd, the largest shipbuilder in the world, fell 1.1 percent on concerns about fourth quarter earnings result. Hyundai Heavy has already shed nearly 10 percent so far in the month.
Decliners edged out advancers 376 to 374.
The KOSPI 200 benchmark of core stocks was up 0.4 percent, while the tech-heavy junior KOSDAQ edged 0.3 percent higher. ($1 = 1062.7000 Korean won) (Reporting by Jungmin Jang; Editing by Shri Navaratnam)
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