South Korean shares ended slightly lower on Thursday after falling in the previous session as investors took to the sidelines amid lack of momentum to move local stocks in any direction, analysts said.

The benchmark Korea Composite Stock Price Index (KOSPI) edged down 2.48 points, or 0.13 percent, to close at 1,863.71. Trading volume stood at 528.82 million shares worth 4.79 trillion won (4. 16 billion U.S. dollars).

The KOSPI fluctuated in a narrow box range throughout the session after the U.S. stocks ended mixed overnight, and ended slightly lower amid lingering concerns over Europe's debt crisis.

"There was no specific news to move the KOSPI up or down. Local stocks seem to lose their direction as unstable situation continued for long," Kang Hyun-gie, a strategist at Solomon Investment & Securities in Seoul, told Xinhua.

Kang noted that it was still hard to say that the U.S. economic indicators would show better performance going forward despite the recent positive results, saying that concerns remained over the European fiscal crisis. The expert said that investors should watch the movement of global oil prices, warning that higher oil prices may block easier monetary policy by global central banks.

On the New York Mercantile Exchange, the Western Texas Intermediate (WTI) crude price for February delivery rose 0.26 U.S. dollars, or 0.3 percent, to settle at 103.22 U.S. dollars a barrel overnight, keeping its recent rally. In London, Brent crude for February delivery also rose one percent to trade at 113.28 U.S. dollars a barrel.

Worries about Europe remained. News was released that Spain may seek international aid, boosting concerns over the region's debt crisis. Overnight deposits of the region's commercial banks at the European Central Bank (ECB) hit a new record high of 453 billion euros, indicating that banks in the region were reluctant to lend to each other.

Meanwhile, the U.S. economic data painted a rosy picture. U.S. factory orders grew for the first time in three months in November, with the U.S. automakers reporting solid sales in the last month of 2011.

Retail investors led the market decline. They sold a net 231.9 billion won worth of shares in a bid to lock in recent profits. Foreign investors turned to net sellers in three trading days, posting net selling worth 43.8 billion won.

Institutional investors shored up stocks. Local institutions bought a net 268.6 billion won worth of shares, while program- linked buying reached 305.5 billion won.

Large-cap shares lost ground due to burdens for their recent rally. Market bellwether Samsung Electronics fell 2.31 percent to 1,055,000 won, and the world's largest shipbuilder Hyundai Heavy Industries inched down 0.36 percent to 277,500 won. The nation's No. 2 carmaker Kia Motors was down 0.44 percent, and leading banking group Shinhan Financial Group lost 0.88 percent.

In contrast, oil refiners ended bullish on rising global oil prices. Top crude oil refiner SK Innovation gained 2.66 percent to 154,500 won, and its smaller rival S-Oil jumped 4.29 percent to 109,500 won. Leading chemical firm LG Chem rose 2.16 percent to 331,500 won.

The local currency closed at 1,152.7 won against the greenback, down 4.1 won from Wednesday's close.

Bond prices ended mixed. The yield on the liquid three-year treasury notes dipped 0.01 percentage point to 3.34 percent, but the return on the benchmark five-year government bonds finished steady at 3.49 percent. (One U.S. dollar equals 1152.5 won)