[THE INVESTOR] Korean shares ended lower on Jan. 22 on foreign and institutional selling. The Korean won fell against the US dollar.

The benchmark KOSPI lost 18.15 points, or 0.72 percent, to fall to 2502.11.

Foreigners sold a net 176 billion won (US$164 million) worth of stocks on profit-taking, weighing on the main index. Institutional investors offloaded a net 72 billion won worth of stocks.

Park Chun-young, an analyst at Daishin Securities, said the decline is blamed on recent tax revisions that would levy heavier capital gains taxes on foreign stock investors.

The Finance Ministry has announced tax code changes -- set to take effect in July -- to collect capital gains tax from foreign investors who own more than 5 percent stakes in locally listed companies. The previous threshold was 25 percent. Non-resident foreign investors and overseas companies are subject to the taxes.

Kim Ye-eun, an analyst at IBK Securities, said the US government shutdown has worsened investor sentiment.

Most large-cap stocks were mixed across the board.

Among the gainers, top carmaker Hyundai Motor rose 0.31 percent to 162,500 won, and Naver was up 1.36 percent to 893,000 won.

Market bellwether Samsung Electronics fell 2.19 percent to 2,412,000 won, and SK hynix, a major chipmaker, shed 3 percent to 71,100 won.

The local currency closed at 1,070.10 won against the US dollar, down 4.20 won from the previous session’s close.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)