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Seoul shares fall on Syria tension, but foreign inflows cap losses

(Updates to midday)

* Financial shares fall on pessimistic earnings outlook

* Automakers rise on foreign buying

SEOUL, Aug 28 (Reuters) - Seoul shares fell Wednesday morning as investors shifted towards safe-haven assets on anxiety about a possible U.S. military strike against Syria, yet continued foreign inflows limited losses.

The Korea Composite Stock Price Index (KOSPI) was down 0.6 percent at 1,874.47 points at 0202 GMT.

"The market is wobbling because of escalated tension in Syria, but the loss was capped due to firm economic fundamentals," said Tong Yang Securities market analyst Lee Jae-mahn.

However, Lee said concerns remain as weak starts from emerging markets such as India and Indonesia could unnerve foreign investors and trigger capital outflows.

Foreign investors were net buyers of 35.1 billion won ($31.44 million) of local shares on Wednesday morning.

Memory chipmaker SK Hynix Inc dropped 1.3 percent, while panel maker LG Display Co Ltd dropped 1.0 percent. Tech giant Samsung Electronics Co Ltd fell 0.5 percent.

Finance shares were generally weaker due to pessimism about their earnings outlooks. Woori Finance Holdings Co Ltd fell 2.8 percent, while Shinhan Financial Group Co Ltd and Hana Financial Group Inc declined 2.0 percent and 1.6 percent, respectively.

Automakers Hyundai Motor Co advanced 1.5 percent and affiliate Kia Motors Corp 1.6 percent as foreigners saw them as cheaper than Japanese competitors.

Crude refiners S-Oil Corp and GS Holdings rose 0.7 percent and 0.4 percent, respectively, on hopes of improved earnings as Brent crude prices rose 7 percent to a six-month high of $115.44 a barrel.

Decliners outnumbered gainers 570 to 190.

The KOSPI 200 benchmark of core stocks slipped 0.4 percent, while the junior KOSDAQ declined 1.1 percent. ($1 = 1116.3250 Korean won) (Reporting by Jungmin Jang; Editing by Richard Borsuk)