An upgrade of South Korea's long-term foreign currency rating by Fitch had little impact, while foreign investors extended their selling streak to a 22nd day.
Plasma display panel maker Samsung SDI Co ended unchanged at 102,000 won, despite reporting a worse-than-expected fall in quarterly profit, after it issued an optimistic outlook.
The benchmark Korea Composite Stock Price Index (KOSPI) closed up 0.09 percent at 1,184.60. The index climbed as much as 0.8 percent and fell 0.6 percent at one point.
Steel makers rose after China's major steel mills agreed to cut production of some high-end flat products by 5 percent in the fourth quarter to help support prices, according to a senior industry official and state media in China.
Excess Chinese supply had flooded the world market, putting pressure on steel prices.
"Strong production in China was triggering steel price weakness in the Asia region. If the Chinese cut production, it would have a positive effect on steel prices," said Park Joon, an analyst at Hyundai Securities.
POSCO Co Ltd rose 2.12 percent to close at 217,000 won. The world's fifth-biggest steel maker planned to price a Japanese share offering, worth more than $700 million at current market prices, on November 15, a company official said.
Smaller rival INI Steel Co surged 7.48 percent to 23,700 won.
Chip makers also gained, tracking firmer US peers, as investors viewed the stocks as undervalued after recent losses. Samsung Electronics Co Ltd, the world's biggest maker of memory chips, rose 0.53 percent to 567,000 won.
Shipping firm Hyundai Merchant Marine Co advanced 4.47 percent to 12,850 won as investors bet Hyundai Asan, the inter-Korean business arm of the Hyundai Group, would resolve its spat with Pyongyang.
But many investors were wary ahead of a slew of quarterly results scheduled for this week and as foreigners continued to sell out of the local stock market.
"It would be hard for the market to gain unless foreign investors turn net buyers," said Kim Yung-min, an equity strategist at Korea Investment Trust Management.
Foreign investors sold a net 17.2 billion won worth of local shares on Monday, bringing their total selling over the past 22 sessions to some 3.1 trillion won ($2.92 billion). It is the longest selling spree since October 1997 when they sold for 25 days in a row.
"Personally, I think this downturn will continue. I don't expect a big rally because we haven't seen a major recovery in earnings or the economy," added Kim.
The main index has been steadily losing ground since hitting an all-time high of 1,246.41 on October 5.
Leading local wireless operator SK Telecom Co fell 1.74 percent to 198,000 won while top local carmaker Hyundai Motor Co fell 0.94 percent to 73,800 won. Both firms are set to release their third-quarter results on Thursday.
Meanwhile, investors showed little reaction to Fitch Ratings' decision to upgrade South Korea's ratings to A-plus from A, citing lower security risks on the peninsula after North Korea agreed to scrap its nuclear weapons programme.
Trade volume reached around 424 million shares worth 3 trillion won compared to 533.3 million shares worth 3.6 trillion won on Friday. Gainers edged out decliners by 434 to 301 with 88 titles ending flat.
Retail investors bought a net 58 billion won, while institutional investors sold a net 32.3 billion won.
The December KOSPI 200 futures index edged down 0.30 point to 152.55 and the underlying KOSPI 200 spot index rose 0.05 point to 152.27.
South Korea's junior and tech heavy Kosdaq market rose 1.33 percent to finish at 592.18.