Seoul shares break losing streak as airlines rise

(Updates to mid-morning)

By Park Jung-youn

SEOUL, June 11 (Reuters) - Seoul shares opened steady on
Wednesday after losing for three straight sessions, with easing
oil giving some help to transportation and chemicals issues such
as Korean Air Line (003490.KS) and LG Chem (051910.KS).

Korean Air gained 1.79 percent to 51,300 won after oil fell
sharply on Tuesday to around $131 a barrel, well below last
Friday's record near $139 [ID:nSP126298]. Asiana Airlines
(020560.KS) rose 1.07 percent to 5,690 won.

Shares in chemicals companies also rallied on hopes oil's
decline will ease their cost burden.

LG Chem rose 4.46 percent to 105,500 won and SK Chemicals
(006120.KS) rose 0.91 percent to 49,750 won. Hanwha Chemical
(009830.KS) climbed 0.88 percent to 11,500 won.

The Korea Composite Stock Price Index was up 0.25
percent to 1,778.82 points as of 0054 GMT, paring some of its 3.3
percent slide since its downward run began last Thursday.

"The market is rebounding slightly, helped by oil's drop
yesterday. But foreign investors continued selling and the
market's direction could reverse after other Asian markets --
such as China's -- open," said Kim Joong-hyun, a market analyst
at Goodmorning Shinhan Securities.

"The prospect of a U.S. interest rate hike also does not bode
well as it puts further pressure on liquidity from overseas," Kim
added.

Foreigners had unloaded a net 23 billion won ($22.40 million)
worth of shares as of 0056 GMT, heading for a third-straight
selling session.

Some technology shares rebounded from their recent sharp
losses despite their U.S. peers' drop overnight on rate hike
worries, with Samsung Electronics (005930.KS) gaining 1.2 percent
to 674,000 won after three consecutive losing sessions that
brought the share down by 6.6 percent.

However Hynix Semiconductor (000660.KS) dipped 0.48 percent
to 31,050 won after the U.S. Philadelphia Stock Exchange index of
semiconductor shares .SOXX lost 1.7 percent on Tuesday as all
but two of its 18 components traded lower [ID:nN10353196]. The
prospects of an interest rate hike in the United States hurt
shares in the growth-sensitive chipmaking sector, after the Fed
Chairman Ben Bernanke reaffirmed the Fed's focus on inflation in
comments late on Monday.

LS Cable (006260.KS) rose 3.94 percent to 105,500 won after a
U.S. wire and cable maker Superior Essex Inc SPSX.O confirmed
on Tuesday it had received a buyout offer for $45 a share from LS
Cable. LS Cable, spun off from LG Group in 2003, has been seeking
revenue growth overseas to compensate for a saturated home
market.[ID:nBNG182096]

Separately, South Korean banks were in the spotlight after
media reports on Tuesday that Lehman Brothers almost struck a
deal with local financial institutions as part of raising $6
billion in capital, and may yet arrange one by the end of the
year.[ID:nN10402090]

Kookmin Bank 060000.KS rose 0.98 percent to 61,700 won, and
Hana Financial Group (086790.KS) was up 2.38 percent to 43,000
won.

($1=1026.7 Won)