South Korean stocks closed 0.34 percent higher Tuesday as automakers and telecommunications shares gained ground, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index advanced 6.59 points to 1,916.93. Trading volume was moderate at 267.3 million shares worth 4.13 trillion won ($3.82 billion) with gainers outpacing losers 436 to 363.

“Weariness against emerging markets has risen. Korea is showing some differentiation from other markets, but it remains to be seen as uncertainty over U.S. monetary stimulus tapering lingers,” said Han Beom-ho, an analyst at Shinhan Investment Corp.

Foreign investors remained net sellers of local stocks by unloading a net 313.5 billion won worth of shares.

The Federal Reserve is set to hold a policy meeting on Tuesday and Wednesday (local time) with all watching whether the U.S. central bank will decide to further reduce its bond purchases.

The Fed’s tapering of quantitative easing is an indication of confidence for the U.S. economy, but it also sparks concerns about capital outflows from emerging countries.

The Seoul government has said that the Fed’s cutback on its stimulus package, along with the slowing economic growth of China, was causing financial instability in developing nations, including Argentina and Turkey. (Yonhap)