South Korean stocks traded sharply lower late Wednesday morning as investors took to the sidelines amid growing uncertainties at both home and abroad.

The benchmark Korea Composite Stock Price Index declined 26.36 points, 1.31 percent, to 1,981.30 as of 11:20 a.m.

Investors' appetite for less risky assets appeared to be growing amid a high-profile scandal that centers on allegations that a confidante of President Park Geun-hye interfered in state affairs and peddled influence.

Also, concerns persist from overseas factors ahead of the FOMC meeting later this week and the US presidential campaign.

Most large caps were in negative terrain.

Top market cap Samsung Electronics shed 0.42 percent, and major chipmaker SK hynix was down 3.1 percent.

AmorePacific, the No.1 cosmetics maker, fell 2.08 percent.

Naver, the country's top portal operator, declined 2.01 percent.

Hyundai Motor, the country's top automaker, fell 0.71 percent while its smaller affiliate Kia Motors edged up 0.12 percent.

The South Korean won was trading at 1,150.50 won against the US greenback, down 10.60 won from the previous session's close. (Yonhap)