By Rhee So-eui

SEOUL, Nov 18 (Reuters) - Seoul shares rose 1 percent on Thursday as heavy foreign and program buying sent technology, banking and auto issues higher, with investors increasingly believing a rebound was due after the KOSPI's recent underperformance.

Newly listed Grand Korea Leisure (GKL), a foreigner-only casino operator, finished at 15,850 won ($13.71) against its IPO price of 12,000 won, boosted by strong business prospects.

The summit between U.S. President Barack Obama and South Korean President Lee Myung-bak covered North Korea and a U.S.-South Korea free trading agreement, but related news had little impact on the market.

The Korea Composite Stock Price Index rose 1.03 percent to finish at 1,620.54 points, its highest close since Oct. 27.

Foreign investors bought a net 651 billion won worth of shares on the main board while program-linked buying reached a net 501 billion won.

Analysts expect the index to face resistance around the mid-1,600 point level and a further rally to come only when overall demand for equities improves further.

Banks advanced, little affected by the financial regulator's move to limit their foreign currency forwards deals with exporters. Analysts said the regulations were primarily focused on stabilising the foreign exchange market and mostly in line with current trading patterns.

KB Financial Group rose 1.79 percent and Shinhan Financial Group climbed 1.56 percent.

"The key factor behind the KOSPI's recent sluggishness, compared to the global markets, has been worries about slower corporate earnings due to the strong won and high oil prices," said Bae Sung-young, an analyst at Hyundai Securities.

"Signs of recovery in U.S. consumption can offset some of those concerns, with the upcoming Black Friday raising hopes for exporters."

Hynix Semiconductor rose 2.67 percent and LG Electronics climbed 2.94 percent.

Car parts maker Hyundai Mobis extended its rally to finish up 4.76 percent, after Hyundai Motor late Wednesday sold a 1.68 percent stake in Mobis and eliminated overhang concerns.

Hyundai Motor rose 1.5 percent and Kia Motors added 2.02 percent.

President Lee Myung-bak said South Korea was willing to reopen discussions on the automobile trade under a free trade agreement with the United States to address U.S. industry concerns.

Defensive telecom operators were among decliners, with SK Telecom falling 0.85 percent and LG Telecom down 1.62 percent. Keywords: MARKETS KOREA STOCKS

COPYRIGHT

Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.