Seoul shares fall 0.8 pct; Daewoo E&C tumbles

* KOSPI declines on foreign, institutional selling

* Samsung Imaging rises on tender offer reports

* Daewoo Engineering tumbles after preferred buyers named

(Updates to close)

By Jungyoun Park

SEOUL, Nov 24 (Reuters) - Seoul shares reversed earlier gains to end down 0.8 percent on Tuesday led by technology issues including Samsung Electronics (005930.KS), while losses in Daewoo Engineering (047040.KS) added further pressure.

Analysts said the main index would likely trade near its 60-day moving average for the short-term as markets lack compelling factors pointing to improvements in the economic outlook.

"The KOSPI is having difficulty rising above 1,630 points, and markets will trade within a boxed range for sometime," said Lim Dong-min, a market analyst at KB Investment & Securities.

"Improvements in economies and corporate earnings have been good so far, but the question is whether these will continue into next year," Lim added.

The main KOSPI's 60-day moving average is about 1,600 points according to Thomson Reuters data.

Foreign investors were sellers of a net 105.4 billion won worth of stocks, selling for a second consecutive session, and institutions offloaded a net 156.8 won.

"Technology exporters are down on continued forex uncertainties, and investors are also locking in profits on the latest gains by banks," said Kim Seong-bong, a market analyst at Samsung Securities.

The Korea Composite Stock Price Index (KOSPI) ended down 12.63 points at 1,606.42 points.

Shares in Samsung Electronics, the world's No.1 memory chip maker, fell 2.24 percent and LG Electronics (066570.KS), the world's No.3 make of handsets, declined 1.86 percent.

Daewoo Engineering & Construction Co Ltd (047040.KS) lost 5.4 percent, after news late on Monday that an Abu Dhabi fund-led consortium and a group including a U.S. builder were picked as its preferred buyers by parent Kumho Asiana Group in a deal estimated to fetch about $2.6 billion. [ID:nSEO97180]

"So far there is not much known about these bidders. If a suitable buyer who could help normalise this highly competent builder is found, that would be positive," said Hue Moon-wook, an analyst at KB Investment & Securities.

"But if the main purpose of this sale is to get Kumho Asiana Group the money it is looking to raise, the impact on Daewoo may not be very good," Hue added.

Samsung Imaging (108070.KS) rose 0.68 percent on reports it would make a tender offer of its shares for a merger with Samsung Electronics.

But shares trimmed earlier gains of as much as 7 percent after the company denied the reports.

"Repeating our earlier regulatory filings, nothing has been decided on matters such as a merger [with Samsung Electronics]," a company spokesman told Reuters.

Woori Finance Holdings (053000.KS) retreated after South Korea's Korea Deposit Insurance Corp (KDIC) sold 56 million shares in the group at 15,350 per share, offloading a total of 866 billion won ($752.2 million), according to a statement by the state agency on Tuesday.

Woori Finance ended down 2.18 percent, but outperformed Hana Financial Group's (086790.KS) 2.85 percent loss. KB Financial Group (105560.KS) declined 0.63 percent.