* Investors cautious after China services PMI
* SK Innovation, S-Oil shares slump on weaker oil prices
* SK Hynix rises on media reports of smartphone demand
SEOUL, Oct 4 (Reuters) - Seoul shares edged lower on Thursday morning as investors found it difficult to shake off disappointing data that showed a sharp weakening in China's service sector, with slumping oil prices also helping to push down energy-related stocks.
The Korea Composite Stock Price Index (KOSPI) ticked 0.3 percent lower to 1,989.40 points as of 0237 GMT, underperforming a 0.1 percent drop for the MSCI index of Asia-Pacific shares excluding Japan .
"Disappointing PMI data that came out of China is weighing on the market. Falling oil prices may boost certain stocks but the overall picture is one of weak demand globally, especially in China," said Rhoo Yong-seok, an analyst at Hyundai Securities.
The official purchasing managers' index (PMI) for China's services sector fell to 53.7 in September from 56.3 in August, according to data released on Wednesday.
Oil prices fell sharply after poor economic data from China and Europe reinforced concerns about demand for petroleum.
SK Innovation , South Korea's largest refiner, slumped 2.4 percent on falling oil prices, while competitor S-Oil was down 1.4 percent.
Shares in SK Hynix , the world's second-largest memory chip maker, rose 3.8 percent, helped by media reports of strong demand for its NAND chips from smartphone manufacturers that have given rise to speculation that it will raise NAND chip prices.
Declining shares outnumbered advancers 426 to 345.
The KOSPI 200 benchmark of core stocks was down 0.4 percent, while the junior KOSDAQ fell 0.6 percent higher.
(Reporting by SoMang Yang; Editing by Edwina Gibbs)
Keywords: MARKETS KOREA STOCKS/