South Korean shares rebounded in four sessions on Tuesday as local investors snapped up stocks on views that the domestic stock market was undervalued due to excessive reflection of political uncertainties in Europe, analysts said.

The benchmark Korea Composite Stock Price Index (KOSPI) gained 10.57 points, or 0.54 percent, to close at 1,967.01. Trading volume stood at 486.23 million shares worth 4.11 trillion won (3. 62 billion U.S. dollars).

The KOSPI started higher, and stayed in negative terrain throughout the session as retail investors and local institutions bought stocks on views that the local stock market excessively reflected the political uncertainties in Europe.

As widely expected, French voters elected Socialist Party candidate Francois Hollande, a well-known opponent of austerity measures, as their president instead of the current president Nicolas Sarkozy. Hollande's victory boosted concerns that the new fiscal pact in Europe may be renegotiated in favor of economic growth, but those worries were regarded as being already priced in the market.

In Greece, voters also rejected austerity policies backed by the two incumbent parties, but local investors felt no surprise over the election result as it was widely expected in the market.

"There were no specific issues in the market. Political uncertainties in Europe have already been priced in the market. Local stocks rebounded today helped by views that the local stock market was undervalued," Yoo Kyung-ha, an analyst at Dongbu Securities in Seoul, told Xinhua.

Yoo noted that the KOSPI was expected to keep its range-bound trend for the time being as investors tried to wait and see whether Hollande will actually express his opposition to the new fiscal pact of Europe, saying that market volatilities may be stronger this month.

Yoo, however, forecast that the local stock market may turn to a strong upward trend starting the second half of this year as China, the world's No. 2 economy, was predicted to change its monetary policy in an easier direction.

Retail investors bought a net 133.2 billion won worth of shares, and institutional investors purchased a net 76.6 billion won worth of stocks.

Foreign investors, however, kept their selling streak for five straight sessions by offloading a net 303.7 billion won worth of local stocks. Foreigners dumped a total of 1.1 trillion won in domestic stocks over the past five sessions.

Large-cap shares ended mixed. Market bellwether Samsung Electronics edged down 0.1 percent to 1,341,000 won, logging its downward trend for four straight sessions. Top automaker Hyundai Motor was down 0.8 percent to 255,500 won, and the nation's biggest auto parts maker Hyundai Mobis slid 1.9 percent to 285,500 won.

The world's largest shipyard Hyundai Heavy Industries dipped 0. 9 percent to 274,500 won, and memory chip giant SK Hynix dropped 2. 2 percent to 26,650 won.

In contrast, other large-cap stocks ended bullish. The nation's No. 2 carmaker Kia Motors rose 1.1 percent to 81,800 won, and top steelmaker POSCO climbed 2.6 percent to 379,500 won. Consumer electronics giant LG Electronics gained 1.9 percent to 71,000 won, and leading chemical firm LG Chem advanced 1.4 percent to 298,00 won.

The local currency finished at 1,135.6 won against the greenback, up 2.9 won from Monday's close.

Bond prices ended lower. The yield on the liquid three-year treasury notes rose 0.01 percentage point to 3.39 percent, and the return on the benchmark five-year government bonds added 0.02 percentage point to 3.50 percent.