South Korean shares rebound on record foreign buying

South Korean shares made the first rebound in three sessions on Tuesday, paring initial losses, as foreigners kept their record-breaking buying trend despite mounting concerns about possible default on debt in Washington. The benchmark Korea Composite Stock Price Index (KOSPI) rose 8. 34 points, or 0.42 percent, to close at 2,002.76. Trading volume stood at 311.6 million shares worth 3.67 trillion won (3.42 billion US dollars). Foreigners maintained their winning streak for 29 straight sessions by purchasing a net 77.3 billion won worth of local shares. It was the longest buying spree since 1999 when the Korea Exchange began to compile the related data. Retail investors bought shares worth 26.3 billion won, but institutional investors were net sellers of a net 61.1 billion won worth of stocks. The KOSPI stayed in negative territory in early trading due to growing worries about the possible debt default in Washington that hit the U.S. stocks overnight. The fiscal deadlock dragged on into the second week, with little signs of progress in budget talks in Congress. If Congress fails to raise the current debt ceiling of 16.7 trillion dollars by the deadline of Oct. 17, the US administration will fall into default on debt for the first time in the country's history. South Korea's main opposition party urged the government to prepare for prolonged U.S. fiscal crisis, cautioning that problems would not be resolved completely even after agreements on the budget plan and debt ceiling are reached in Congress. Large-cap shares ended mixed. Market bellwether Samsung Electronics slid 0.4 percent, and POSCO, SK Hynix and SK Telecom ended in negative territory. The world's largest shipbuilder Hyundai Heavy Industries jumped 4.1 percent, and top automaker Hyundai Motor gained 2.4 percent. Top life insurer Samsung Life Insurance and the nation's No. 2 carmaker Kia Motors rose more than 1 percent. The South Korean currency finished at 1,073.7 won against the greenback, down 2.2 won from Monday's close. Bond prices ended lower. The yield on the liquid three-year treasury notes rose 0.01 percentage point to 2.85 percent, and the return on the benchmark 10-year government bonds gained 0.04 percentage point to 3.46 percent.