* Foreign investors buy for a second straight session
* POSCO up sharply after Japan peers raise steel prices
* Tech heavyweights Samsung Elec, LG Elec rally
SEOUL, July 23 (Reuters) - Seoul shares advanced firmly on Tuesday, rising for a second straight session on continued foreign investor demand and solid gains in the market's large cap issues including Samsung Electronics Co Ltd and POSCO.
The Korea Composite Stock Price Index (KOSPI) was up 1 percent at 1,899.90 points as of 0150 GMT.
"Rallies overnight on Wall Street fuelled optimism here in Seoul's market as well. Foreign buying is seen sustained for some time," said Ko Seung-hee, a market analyst at SK Securities.
Foreign investors were buyers of a net 83.2 billion Korean won ($74.36 million) worth of stocks, picking up shares for a second straight session.
The S&P 500 notched a third consecutive record closing high and major Wall Street indexes rose overnight.
Gains were led by the market's key large cap issues, with Samsung Electronics, the biggest component on the main KOSPI, advancing 2 percent. POSCO, the third-biggest, advanced 3 percent.
POSCO shares were buoyed by a media report that Japan's Nippon Steel & Sumitomo Metal Corp and Toyota Motor Corp have agreed to raise steel prices, boosting hopes of a recovery in the sector.
"The report has reinforced hopes that other steelmakers in the region will be able to follow suit in raising prices," said Cho Kang-un, an analyst at Shinyong Investment & Securities.
"Chinese steel prices have been rising almost every day in July, although questions remain whether the rebound will be sustainable" Cho said.
LG Electronics Inc shares gained 3.6 percent ahead of its quarterly results announcement on Wednesday.
"Earnings forecasts have steadily been upgraded. But key details such as how its handset business has fared and its outlook remain to be seen tomorrow," said S.R. Kwon, an analyst at Dongbu Securities.
LG Display Co Ltd shares were up 1.7 percent.
Automakers weighed after their recent rallies and ahead of results later this week. Hyundai Motor Co edged down 1.1 percent and Kia Motors Corp slipped 0.7 percent.
Hyundai Motor and Kia Motors shares have gained 21 percent in the past three months, compared with the broader KOSPI's 2.4 percent fall during the same period.
Investors were waiting to see if the results of automakers warranted further gains in their shares from current levels, said Kim Joon-sung, an analyst at Meritz Securities.
Crude oil refiners lagged after U.S. oil prices pulled back sharply on Monday from last week's 16-month high.
SK Innovation Co Ltd, South Korea's top crude oil refiner, dipped 1.4 percent and GS Holdings, the holding company of the country's No.2 refiner, fell 1.4 percent.
The KOSPI 200 benchmark of core stocks was up 1.2 percent, while the junior KOSDAQ edged up 0.25 percent.
$1 = 1118.9250 Korean won Reporting by Jungyoun Park; Additional reporting by Hyunjoo Jin; Editing by Jacqueline Wong