Seoul shares fell on Thursday as weak factory activity in China added to investor disappointment that the US Federal Reserve delivered only a limited expansion of monetary stimulus. The Korea Composite Stock Price Index (KOSPI) fell 0.79 percent to close at 1,889.15 points, retreating from a five-week high in the previous session.
"Risk appetite was somewhat dampened as fears of a further slowdown in China's economy resurfaced due to soft PMI data," said Park Hyung-joong, an analyst at Meritz Securities. Energy stocks and steelmakers underperformed, with SK Innovation Co Ltd down 3.34 percent while Samsung Engineering Co Ltd fell 4.13 percent.
Investors were seen stocking up on defensive plays, with retailer Hyundai Department Store Co Ltd rallying 4.44 percent to emerge as a star performer. Hi-mart Co Ltd tumbled 8.96 percent as SK Networks Co Ltd and Shinsegae Co Ltd announced on Wednesday it had dropped out of the bidding to acquire a 65.25 percent stake in the electronics retailer.
Lotte Shopping announced it entered a bid for Hi-mart. Some 3.74 trillion won ($3.25 billion) worth of shares changed hands, reaching 92 percent of the average turnover for the past 20 sessions, while advancing shares narrowly outnumbered decliners 415 to 402. The KOSPI 200 index of core stocks fell 0.97 percent while the junior, tech-heavy KOSDAQ edged 0.13 percent higher.