Seoul shares up on chipmakers; LG Display slides

(Updates to mid-morning)

SEOUL, April 11 (Reuters) - Seoul stocks were up 0.2 percent
on Friday morning with gains by chipmakers outweighing a near 5
percent fall in LG Display (034220.KS), which was hurt by
competition worries despite its solid earnings on Thursday.

Foreign investors were again sellers on recession concerns
but gains by chipmakers underpinned the the main index, drawing
support from recent moves by makers of memory chips to raise
prices and a rally in their Wall Street peers' overnight on a
brokerage upgrade for chipmakers.

The Korea Composite Stock Price Index was up 0.2 percent to
1,768.22 points as of 0145 GMT, with retail investors fuelling
the upward momentum for a third consecutive session, picking up
shares worth a net 89 billion won.

"Foreigners have switched to selling mode after recent strong
buying, as the spectre of a U.S. recession and hike in
commodities prices weigh on sentiment," said Bae Sung-young, a
market analyst at Hyundai Securities.

"As corporate earnings season has begun, investor mood will
change from on day to next," he added.

Samsung Electronics (005930.KS) and Hynix Semiconductor
(000660.KS) extended gains following Japanese rival Elpida's
announcement on Wednesday that it would charge module makers up
to 10 percent more for its DRAM chips in the first half of April.

"The latest moves by chipmakers are raising hopes that
perhaps the memory chip market downturn has hit bottom and will
gradually get better from here," said Suh Do-won, an analyst at
Hanwha Securities.

"Oversupply concern still weighs heavily on memory
chipmakers, but investors are hungry for slightest good news and
they are quickly responding to it," he added.

Samsung rose 2.13 percent to 670,000 won, making its gains
since mid-March nearly 18 percent. Hynix advanced 3.44 percent to
28,600 won, rising more than 19 percent since March 17.

LG DISMAY

Shares in flat screen maker LG Display traded at 43,900 won,
even though first quarter earnings announced on Thursday
rebounded strongly on demand for TV screens ahead of the summer
Olympics in Beijing.

"Earnings certainly came in strong just as we expected. But
the question is, will LCD (liquid crystal display) market demand
hold up?" said Kim Young-june, an analyst at Kyobo Securities.

"There are concerns that the market will peak this year, with
slower demand in 2009. We are already seeing inventories piling
up in TV panels," he added.

Analysts also said market competition within the TV market is
intensifying with aggressive cost cutting and marketing by rivals
such as Sony Corp (6758.T).

Some steelmakers rose after POSCO (005490.KS), which is
scheduled to report its earnings on Friday, raised its steel
prices by as much as a fifth on Thursday as it seeks to pass on
soaring raw material costs.

POSCO rose 0.51 percent to 490,500 won, also supported by
news Citigroup raised its price target and earnings forecasts for
the stock.

Dongbu Steel (016380.KS) advanced 3.02 percent to 11,950 won.

(Reporting by Park Jung-youn; Editing by Keiron Henderson)