(Updates at 0600 GMT)

TOKYO, May 21 (Reuters) - Japan's Nikkei share average

surrendered early gains to end lower on Tuesday, as investors

slowed activity ahead of U.S. chipmaker Nvidia's ( NVDA ) earnings

report.

The Nikkei fell 0.31% to 38,946.93, after rising as

much as 0.7% earlier in the session.

The index rose 0.78% in the previous session, hitting 39,000

level for the first time in a month.

The broader Topix fell 0.3% to 2,759.72.

"The Nikkei's momentum didn't last as investors refrained

from active buying before Nvidia's ( NVDA ) earnings on

Wednesday," said Shigetoshi Kamada, general manager at the

research department at Tachibana Securities.

Air-conditioner maker Daikin Industries ( DKILF ) fell 4.68%

to become the biggest drag on the Nikkei. Technology investor

SoftBank Group ( SFTBF ) lost 1.64%.

Chip-related shares rose, with Advantest ( ADTTF ) and Tokyo

Electron ( TOELF ) rising 1.45% and 0.8%, respectively.

Insurers were strong, with MS&AD Insurance Group ( MSADF )

surging 13.79% after the company said on Monday its group net

profit is forecast to rise 65% and that it would buy back up to

8.2% of its shares.

Peer Tokio Marine Holdings ( TKOMF ) rose 2.34% after

announcing it would sell down cross-share holdings to zero by

the end of fiscal 2029/30.

The insurance sector rose 2.29% to become the

best performer among the Tokyo Stock Exchange's (TSE) 33

industry sub-indexes.

Sompo Holdings ( NHOLF ) fell 6% as the insurer flagged a 45%

decline in its annual net profit.

KFC Holdings rose to a daily limit high of 6,400

yen, after being untraded with a glut of buy orders, as the

operator of Kentucky Fried Chicken outlets said U.S. buyout fund

Carlyle Group ( CG ) offered to buy shares of the company at

6,500 yen per stock.

Of more than 1,600 stocks trading on the TSE's prime

section, 34% of shares rose and 61% fell with 4% being flat.