South Korean stocks opened nearly flat Thursday amid rising Sino-American tensions and recovery hopes of the pandemic-hit global economy.

The benchmark Korea Composite Stock Price Index (KOSPI) fell 2.13 points, or 0.1 percent, to 2,199.75 in the first 15 minutes of trading.

Investors walked a tight rope between signs of a global economic recovery and the rising political friction between the world's two largest economies.

US industrial production in June jumped 5.4 percent from a month ago, the largest on-month jump since 1959, indicating a rebound in the manufacturing sector.

However, growing tension between the United States and China over China's new national security law in Hong Kong dented investor sentiment for risks.

US President Donald Trump ordered the termination of Hong Kong's special status in protest of a new Chinese security law that can severely restrict civil rights in Hong Kong. He also signed legislation on sanctioning Chinese officials.

In Seoul, most large caps traded lower.

Market bellwether Samsung Electronics shed 0.37 percent, and No. 2 chipmaker SK hynix fell 0.24 percent.

Top pharmaceutical firm Samsung BioLogics dipped 0.8 percent, while leading chemical maker LG Chem climbed 0.18 percent.

South Korea's largest automaker, Hyundai Motor, stayed flat.

The local currency was trading at 1,201.45 won against the US dollar, down 0.95 won from the previous session's close. (Yonhap)