South Korean shares closed lower on Tuesday, snapping a three-day winning streak as investors appeared skeptical over the US Federal Reserve's possible rate cut in September.

The Korea Composite Stock Price Index or Kospi fell 30.5 points, or 0.95%, to end at 3,179.36. The Kosdaq increased by 3.64 points, or 0.5%, to close at 801.66.

In economic news, South Korea's composite consumer sentiment index increased by 0.6 points to 111.4 in August from 110.8 in July, according to data released by the Bank of Korea on Tuesday.

A reading above 100 indicates an improvement in outlook, while a reading under 100 suggests pessimism.

Sentiment toward current living standards rose by two points to 96, while sentiment on the future outlook was unchanged at 101.

The outlook for future household income and the sentiment for future household spending were unchanged at 102 and 111, respectively.

Optimism regarding current local economic conditions increased by seven points to 93, and the reading for future domestic economic conditions was six points lower at 100.

In corporate news, Hyundai Motor Group -- the parent company of Hyundai Motor (KRX:005380) and Kia (KRX:000270) -- plans to invest a total of $26 billion in the US between 2025 and 2028, with an aim to expand its reach in the country, the group said in a Tuesday release.

This marks an increase of $5 billion from its earlier pledge of $21 billion.

The investments will be made in a new steel mill in Louisiana, expanding the group's US auto production capacity, and establishing a robotics facility with an annual capacity of 30,000 units.

Shares of both Hyundai Motor and Kia fell nearly 2% at market close.