S.Korea stocks slip; retail, institutional investors guard foreign sell-off

* KOSPI falls, foreigners net sellers

* Korean won weakens against U.S. dollar

* South Korea benchmark bond yield falls

* For the midday report, please click

SEOUL, May 27 (Reuters) - Round-up of South Korean financial markets:

** South Korean shares closed marginally lower on Thursday, as domestic retail and institutional investors guarded a sell-off by foreign players, and as fears that central banks were close to considering winding back their emergency stimulus weighed.

** The KOSPI ended down 2.59 points, or 0.08%, at 3,165.84, recovering from an early drop of 0.82%.

** Battery maker LG Chem fell 3.49%, following a 6.73% drop on Wednesday, as its unit LG Energy Solution said it would be voluntarily recalling its Energy Storage System batteries, costing the company around 400 billion won ($358.21 million).

** Among other heavyweights, chip giant Samsung Electronics fell 0.25%, while internet giant Naver and Hyundai Motor dropped 1.38% and 1.34%, respectively.

** South Korea’s central bank upgraded its economic outlook and projected high consumer inflation, signalling an eventual tilt towards tightening to end its run of pandemic era record-low interest rates.

** Foreigners were net sellers of 423.2 billion won ($378.69 million) worth of shares on the main board.

** “Worries about outflows of passive funds, following a reduction in the weighting of local stocks on the MSCI benchmark, also weighed on KOSPI but institutional investors increased their positions, guarding the declines,” said Bookook Securities analyst Lee Won.

** The won ended at 1,118.1 per dollar on the onshore settlement platform, 0.11% lower than its previous close at 1,116.9.

** In offshore trading, the won was quoted at 1,117.5 per dollar, down 0.1% from the previous day, while in non-deliverable forward trading its one-month contract was quoted at 1,117.1.

** In money and debt markets, June futures on three-year treasury bonds rose 0.15 point to 111.02.

** The benchmark 10-year yield fell by 2.0 basis points to 2.107%. ($1 = 1,117.5300 won) (Reporting by Joori Roh; Additional reporting by Jihoon Lee; Editing by Subhranshu Sahu)