TOKYO, April 26 (Reuters) - Japan's Nikkei share average

rose on Friday led by a rebound in chip-related stocks, while

investors awaited the central bank's policy decision.

Chip sector shares recovered from Thursday's losses,

tracking overnight gains in U.S. peers, with the Philadephia SE

Semiconductor Index jumping nearly 2% even as Wall

Street's three main indexes declined.

U.S. stock futures were pointing to gains for

Friday though, following strong after-the-bell earnings from

tech giants Alphabet and Microsoft ( MSFT ).

The Bank of Japan is widely expected to leave interest rates

unchanged on Friday, after just raising them for the first time

since 2007 last month. However, investors are on guard for

hawkish signals potentially aimed at propping up the yen, which

has this month hit 34-year lows.

The time of the policy announcement is not set, but tends to

come around the time stock markets reopen from the midday

recess.

The Nikkei gained 0.5% to 37,811.98 as of 0222 GMT,

making up some of Thursday's 2.16% slide. For the week, the

index has added 1.95%, recouping part of the previous week's

6.21% tumble, its worst weekly performance since June 2022.

The broader Topix rose 0.38%, heading for a 1.8%

advance for the week.

"Japanese equities are going to be mainly driven by U.S.

equities," said Shoki Omori, chief Japan desk strategist at

Mizuho Securities.

"Unless rate hike expectations strengthen, I don't see the

BOJ having much of a direct impact on equities."

"What's more harmful is a further pricing out of U.S. rate

cuts," which would see long-term Treasury yields

target 5%, from around 4.7% currently, hurting tech shares in

particular, he added.

Considering the Nikkei is still up close to 13% so far this

year, there is scope for a slide back to 35,000, Omori said.

Tech shares were among the Nikkei's biggest supports, with

chip-making equipment giant Tokyo Electron ( TOELF ) climbing

2.14% and startup-investor SoftBank Group gaining

1.82%.

Shin-Etsu Chemical ( SHECF ) bucked the trend among

semiconductor stocks, with the silicon producer diving more than

6% after announcing it would offer a hefty premium in a takeover

offer for Mimasu Semiconductor Industry ( MSMCF ).