TOKYO, June 9 (Reuters) - Japan's Nikkei share average

advanced 1% on Monday ahead of trade talks between the U.S. and

China in London later in the day, with investors watching for

any easing of restrictions over semiconductor shipments.

Both countries are under pressure to relieve tensions, with

China dominating global exports of rare earth minerals needed

for chips and other advanced technologies, while the U.S. has

curtailed exports of chip-design software to China.

A phone call between U.S. President Donald Trump and Chinese

counterpart Xi Jinping on Thursday led to the Monday talks, with

Trump later saying rare earth supply would no longer be a

problem for the United States.

The Nikkei rose 1.05% to 38,137.09 as of the midday

trading recess.

The broader Topix rose 0.63%. A sub-index of growth

shares rallied 0.8%, outpacing a 0.47% rise in value

shares.

Chip-testing equipment maker and Nvidia supplier Advantest ( ADTTF )

was Nikkei's biggest gainer in index-point terms with a

5.17% climb.

"The trade talks in London are at the very least a step in

the direction of easing restrictions on chip shipments between

the U.S. and China," buoying the sector on Monday, said Yunosuke

Ikeda, chief macro strategist at Nomura.

Artificial intelligence-focused startup investor SoftBank

Group jumped 4.03%. Chip-sector stocks Disco

and Lasertec ( LSRCF ) rose about 3% each.

Otsuka Holdings ( OTSKY ), the Nikkei's biggest percentage

gainer, soared 8.65% after the drugmaker said its experimental

therapy for a potentially life-threatening kidney disease more

than halved severe levels of protein in the urine of patients.

On the other end, iSpace was poised to fall by the

daily limit for the second straight session after its second

failed attempt to put a lunar lander on the moon last week.

The stock was set to slide 20%, with offers to sell

outnumbering bids by 9-to-1.