REFILE-Seoul shares close lower on geopolitical risks

(Refiles to fix table)

* KOSPI falls 0.73 pct

* Samsung SDI, LG Elec rise on outlook hopes

* Hynix down ahead of new shares' market debut

(Updates to close)

By Jungyoun Park

SEOUL, May 27 (Reuters) - Seoul shares turned lower to end
down 0.73 percent on Wednesday, as the latest developments in
North Korea put the spotlight on geopolitical risks for South
Korea, but gains in techs including LG Elec (066570.KS) lent
support.

The Korea Composite Stock Price Index (KOSPI)
finished down 0.73 percent to 1,362.02 points.

"South Korea's geopolitical risks are being highlighted
increasingly on the back of North Korea's reactions to the
South's joining the PSI (Proliferation Security Initiatives),"
said Kim Hak-kyun, a market analyst at Korea Investment &
Securities.

North Korea, facing international sanction for this week's
nuclear test, on Wednesday threatened to attack the south after
Seoul joined a U.S.-led initiative to check vessels suspected of
carrying equipment for weapons of mass destruction. [ID:nSP72126]

North Korea fired another short-range missile off its east
coast late on Tuesday, Yonhap News reported on Wednesday.
[ID:nSEL000627]

"With stock markets having lost steam following weeks of
gains, domestic and internal risks are pressuring sentiment,
prompting falls in Seoul markets while other regional shares are
doing well," Kim added.

Hynix Semiconductor (000660.KS) finished down 4.17 percent
ahead of the floating of its new shares later this week.

"Selling will likely continue through this week, and
potential buyers are waiting until the current trend passes,"
said Seo Won-seok, an analyst at NH Investment & Securities.

Hynix earlier this month set the pricing for its issuance of
70 million new shares at 10,350 won ($8.06) each. [ID:nSEL000599]

Shares were further pressured by news a U.S. District Court
ordered Hynix to secure the amount it owes Rambus (RMBS.O) in a
patent suit. [ID:nN26513084]

But Samsung SDI (006400.KS) jumped 10.75 percent, helped by a
positive brokerage note from JPMorgan on Wednesday.

JPMorgan upgraded its rating on SDI to "overweight" from
"neutral" and raised target price by 62.5 percent to 130,000 won
from a previous 80,000 won.

JPMorgan said it expected the company to witness organic
growth in the next two years and forecast the company's core
operations would make a V-shaped recovery.

LG Electronics (066570.KS) ended up 5.61 percent on the back
of continued second-quarter earnings hopes, analysts said.

POSCO (005490.KS), the world's No.4 steelmaker, gained 1.54
percent after news Rio Tinto agreed to cut key iron ore prices to
Japanese steelmakers by a third in this year's first contract.
[ID:nSP498033]

"The news is definitely positive for POSCO, although the cut
came in line with expectations. Rio Tinto's price serves as a
benchmark for iron ore, and POSCO will probably reach a similar
agreement with Rio Tinto," said Kim Hyun-tae, an analyst at
Hyundai Securities.

Sources later said POSCO and Rio could reach a deal as early
as Wednesday. [ID:nSE208776]

But banks gave up their earlier gains and turned lower as the
weaker won KRW= weighed on sentiment.

Hana Financial Group (086790.KS), which has heavy exposure to
the forex markets, declined 2.39 percent, while KB Financial
Group (105560.KS) fell 0.58 percent.

Foreign investors bought a net 321.5 billion won worth of
shares, while institutions sold a net 282.6 billion won worth.

Retail investors offloaded a net 19.6 billion won.

Decliners led advancers 592 to 227, with 64 unchanged.

Trading volume stood at 768 million shares worth 8 trillion
won ($6.35 billion) compared with 648 million shares worth 7.8
trillion won on Tuesday.

The KOSPI 200 June futures index ended 0.55 points lower at
173.85, and the KOSPI 200 spot index fell 1.02 points to 173.75.

The junior Kosdaq market declined 2.28 percent to end at
524.33 points.

Move on day -0.73 percent

12-month high 1,853.50 02 JUNE 2008

12-month low 892.16 27 OCT 2008

Change on yr +21.17 percent

All time high 2,085.45 1 NOV 2007

All time low 93.10 06 JAN 1981

(Editing by Chris Lewis)