Seoul shares edge lower on soft major-economy surveys

Mon Mar 24, 2014 9:58pm EDT

* Weak economic readings cloud global growth prospects

* Ukraine worries weigh on riskier assets

* Foreigners net sellers of local stocks in early trade

By Se Young Lee

SEOUL, March 25 (Reuters) - Seoul shares edged lower in early trade Tuesday as signs of slower manufacturing activity in major economies as well as fresh worries over Ukraine led to some profit-taking.

The Korea Composite Stock Price Index (KOSPI) was down 0.1 percent at 1,943.92 points as of 0131 GMT.

The flash Markit/HSBC China Purchasing Managers' Index fell to an eight-month low of 48.1 in March, while the Markit preliminary U.S. manufacturing Purchasing Managers' Index for March also eased from February.

Surveys indicating slower growth in Germany further added to worries about the global economic growth prospects, undercutting riskier assets.

"The weak PMI readings overnight is affecting the market's momentum to some degree, and there appears to be some profit-taking as well," said Hana Daetoo analyst Chang Hee-jong.

"There are still risks weighing on market sentiment, but at the same time the economy is gradually improving so it's not clear whether we're headed for any kind of a correction at this point," he added.

Continued tensions between Ukraine and Russia also rattled investors, with diplomats raising concerns about a NATO-reported buildup of Russian troops at Ukraine's border. Investors are worried about potential economic fallout from the standoff as the risk of more sanctions against Moscow looms.

Foreigners were net sellers of local stocks in early morning trade, reflecting caution. Decliners outnumbered gainers 390 to 352.

Shares of large caps Samsung Electronics Co. and SK Hynix Inc. were down 1.2 percent and 0.8 percent, respectively, on profit-taking pressures as market sentiment weakened.

Shares of LG Chem Ltd. and Hyundai Steel Co. were up 2.4 percent and 1.3 percent, however, on speculation that China, a key market for South Korea's steel and chemical exporters, may introduce fresh stimulus measures to boost growth.

The KOSPI 200 benchmark of core stocks was down 0.1 percent, while the junior KOSDAQ edged 0.4 percent lower. (Reporting by Se Young Lee; Editing by Eric Meijer)

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