Seoul shares advance

Seoul shares ended up 0.55 percent on Tuesday, fuelled by gains in builders and tech issues including LG Display, but Kumho Tire tumbled on an exchange warning. The Korea Composite Stock Price Index finished up 0.55 percent at 1,681.82 points, above the main index's 60-day moving average of around 1,650 points.
"Caution pervades as investors are awaiting details of how Greece's debt issues will be handled by the European Union this week. The decision will potentially impact the euro's value versus the US dollar, which in turn will affect foreign investors' appetite for riskier assets," said Chung Myoung-gi, a market analyst at Samsung Securities.
Chung added that appetite to redeem equity funds at the 1,700 point level had grown, causing the market to face serious resistance. Technology issues outperformed, with LG Display rising 3.69 percent after a local media report the world's No 2 panel maker had finalised talks with a Chinese TV maker and the city of Guangzhou to establish a production joint venture.
An LG Display spokesman confirmed the company had signed an MOU with Skyworth and Guangzhou authorities, but said whether the project would see fruition depended on the approval the central government. "The partnership with a major television maker comes as positive news. This is a good move in terms of its China market strategy," said John So, an analyst at Shinhan Investment Corporation.
Shares in Samsung Electronics, the world's No 1 memory chip maker, ended up 1 percent, boosted by a substantial rise in the key US semiconductor index. Hynix Semiconductor, the world's No 2, gained 1.01 percent. Banking issues rose, with KB Financial Group rising 0.77 percent and Shinhan Financial Group climbing 2.01 percent.
But shares in Kumho Tire lost ground after the Korea Exchange issued an "invest with caution" warning on the stock. A report filed by Kumho Tire on Tuesday showed that 81.6 percent of its capital was impaired, the bourse said. KRX said trading in Kumho Tire stocks would be halted if the situation was confirmed in its fiscal 2009 operations report, scheduled to be submitted within this month.
Early last month, creditor banks of Kumho Asiana, South Korea's ninth-largest conglomerate, said they would keep the cash-starved group under their protection. Shares in the tire-making unit of Kumho Asiana Group plunged 12.7 percent. Construction issues rallied amid order expectations after local media reports South Korean builders were likely to win a significant portion of an estimated $6.6 billion order from Saudi Arabia.
Lead gainers were Hyundai Engineering & Construction, which rose 4.45 percent, and Samsung Engineering, which advanced 4.38 percent. A Hyundai Engineering spokesman said the firm had participated in bidding for the Saudi deal and expected to hear the result in the next month or so.