Transmission hesitates shifting into second and perhaps third gear when driving slow. When acceleration is positive transmission shifts smoothly. Reference "99 Mercury Transmission" as Subject when

Make sure the shifter cable is correctly adjusted.

https://www.kiaownersclub.co.uk/threads/kia-sportage-auto-gear-shift.54702/

This forum may help you.

Time for a rebuild

The transmission is slipping

shift solenoid for second to third is bad about 45 bucks and some mess located under the tranny pan

orbital clutches slipping , needs stripping

If that oil is transmission fluid, you may be low on fluid. That would cause harsh shifts. Make sure your transmission is full.
Is it just reverse and drive that ****? Do second and third shift smooth? If so, you may have a too-high idle.
If idle is good, and your transmission didn't get low on fluid, then I would suggest you drain and refill the transmission, and install a new transmission filter while you have the bottom pan off. Usually, you can buy a filter and pan gasket as a kit.

What is hesitating - the engine or the transmission?

When starting the car and putting it in gear, if the transmission shifts immediately into first gear and then shifts smoothly from first to second gear, I doubt its a transmission problem. However, if that isn't the case, you will probably need a new or rebuilt transmission ($1500+).

Engine hesitation can be due to a lot of things related to the fuel system that won't necessarily show up on a code reader - for example, dirty throttle body, fouled IAC (idle air control) motor, fouled EGR valve, etc.

It should be an electronic problem Scan the transmission and post the codes

Have you had your throttle position sensor checked out? It'll cause a harsh and/or delayed shift from first to second. Second thing to check out is your PCM, as it controls the shifting of your transmission.

sounds like it may be either a converter problem or u got some bad clutches in third in the case you need to go to a tranny shop.

check or replace your thottle position sensor tps that trans needs to know where the throttle is to shift if it is bad it will do as you say wont shift to third
another telltale is it will act like it goes into lockup when shifting into reverse and stall the engine