South Korean shares ended in negative territory on Friday due to concerns over the prolong U.S. government shutdown, but the main index pared initial losses thanks to record-breaking earnings of Samsung Electronics.

The benchmark Korea Composite Stock Price Index (KOSPI) fell 2. 49 points, or 0.12 percent, to close at 1,996.98. Trading volume stood at 237.77 million shares worth 4.25 trillion won (3.97 billion U.S. dollars).

The gauge stayed in the negative terrain in almost all sessions on amid worries about the budget stalemate in Washington. A partial U.S. federal government shutdown entered into the third day after a White House meeting between U.S. President Barack Obama and congressional leaders ended with no breakthrough.

The KOSPI, however, trimmed almost all earlier losses as Samsung Electronics, which account for more than 20 percent of the market capitalization, posted the new record high of profits in the third quarter.

Samsung said in a statement that its preliminary operating profit was estimated at 10.1 trillion won (9.4 billion U.S. dollars) in the three months ending Sept. 30. It topped the prior record high of the 9.53 trillion won profit in the previous quarter, and was up 25.3 percent from the same period of last year.

Revenue was estimated at 59 trillion won in the July-September period, breaching the prior high of 57.46 trillion won tallied in the second quarter. The reading was up 13.1 percent from a year earlier.

Memory chip giant SK Hynix surged 4.2 percent amid positive outlook for the third-quarter earnings. The nation's No.2 carmaker Kia Motors and top wireless carrier SK Telecom advanced more than 2 percent.

Shares of Samsung Electronics ended unchanged at 1,418,000 won as the positive earnings were already priced in, and the country's biggest auto parts maker Hyundai Mobis showed no change in its share price. POSCO, LG Chem and Samsung Life Insurance closed in negative territory.

The South Korean currency finished at 1,070.3 won against the greenback, up 3.7 won from Wednesday's close. The local financial market was closed on Thursday for the National Foundation Day.

Bond prices ended mixed. The yield on the liquid three-year treasury notes rose 0.01 percentage point to 2.83 percent, but the return on the benchmark 10-year government bonds fell 0.01 percentage point to 3.40 percent. Endi

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