* KOSPI falls 1.59 pct
* Automakers outperform after Feb sales, weaker won
* Financials continue to decline
(Updates to mid-morning)
By Jungyoun Park
SEOUL, March 3 (Reuters) - Seoul shares fell on Tuesday after
big losses on Wall Street on worsening fears about U.S.
financials after insurer AIG posted a record quarterly loss, with
the won's weakness also weighing.
The Korea Composite Stock Price Index fell 1.59
percent to 1,002.56 points as of 0137 GMT, after falling to as
low as 992.69 points, its lowest since late November.
The main index sank below the psychologically significant
1,000-point level for the first time in three months.
"Shares are continuing to slide today after losses in U.S.
stocks but we are seeing the size of losses thinning somewhat
following a large decline in the previous session," said Lee
Kyoung-su, a market analyst at Taurus Investment & Securities.
"It seems investors here still have confidence about the
psychologically significant 1,000-point level, which I have said
is still premature to assume."
The KOSPI's 90-day moving average is around 1,100 points.
"External risks, most namely the troubles that the U.S.
financial sector is mired in, is very worrisome. Also the won
currency's weakness will be closedly monitored," Lee added.
The South Korean won KRW= fell more than 1 percent to drift
around an 11-year low against the dollar early on Tuesday.
Meanwhile, American International Group Inc (AIG.N) posted a
record $61.7 billion quarterly loss on Monday and got a new but
not necessarily final government bailout. [ID:nN02363433]
Falls were led by financials, with KB Financial Group
(105560.KS) losing 3.56 percent and Shinhan Financial Group
(055550.KS) retreating 5.45 percent.
The weaker won pressured tourism issues stoking fears the
rapid weakness in the domestic currency will dampen demand for
travel abroad.
Hana Tour (039130.KQ) fell 7.11 percent and Modetour
(080160.KQ) slid 6.19 percent.
But automakers outperformed after they released February
sales data late on Monday, which were underpinned by a more
competitive won currency.
"February sales numbers themselves were weak, but South
Korean automakers have fared better than other industries and
even their peers overseas," said Cho Soo-hong, an analyst at
Hyundai Securities.
Hyundai Motor (005380.KS) rose 1.06 percent after it reported
sales in February fell 3.2 percent from a year earlier, but were
up about 13 percent from January.
Kia Motors (000270.KS) climbed 0.16 percent after posting a
3.9 percent fall in February sales from a year earlier, but a 27
percent rise from a month ago.
"...thanks to the weaker won, domestic automakers are
expected to outperform their foreign peers," Cho added.
(Editing by Jacqueline Wong)
