(Updates with closing levels)

By Brigid Riley

TOKYO, June 25 (Reuters) - Japan's Nikkei share average

rose on Tuesday to its highest close in more than two months, as

investors shifted focus to value stocks from semiconductor and

other high-tech, while a weaker yen also lent support to

export-related shares.

The Nikkei finished up 0.95% at 39,173.15, its

highest closing level since April 15. The broader Topix

climbed 1.72% to 2,787.37.

Investor sentiment remained subdued towards artificial

intelligence- and chip-related shares during Asian trading

hours, after U.S. semiconductor bellwether Nvidia ( NVDA ) slid

for a third session on Monday and the Philadelphia SE

Semiconductor index finished down 3.02%.

Disco Corp ( DISPF ) declined 5.5% to be the largest

percentage loser on the Nikkei, while Tokyo Electron ( TOELF )

fell 1.7%.

Meanwhile, the weaker yen continued to support

export-related shares, including auto maker Toyota Motor ( TM )

, which closed up 4.6%. A softer yen helps boost

Japanese exporters' overseas earnings when repatriated.

Investors also picked up value stocks over their growth

peers, generating widespread gains in the financial sector.

Insurance firms rallied 4.3% to lead sectoral

gains, followed by automakers and suppliers.

"Nikkei is a more value-oriented market, and investors may

be rebalancing during the approaching quarter-end to gain

exposure to the lagging part of the market," said Charu Chanana,

global market strategist and head of FX strategy at Saxo.

"A selective and bottoms-up approach for Japanese stocks

could be attractive from here as yen appreciation risks escalate

in H2."

The Nikkei hit a record high of 41,087.75 on March 22 before

retreating the following month. It has struggled to stay above

the 39,000 level over the past two months as investors assess

currency and bond market volatility, as well as the outlook of

the Bank of Japan.

Among individual stocks, Uniqlo parent Fast Retailing ( FRCOF )

rose 1.1% to give the biggest lift to the Nikkei.

Among the top percentage gainers was heavy machinery maker

IHI, which rose 9.7% to hit a six-year peak.

(Reporting by Brigid Riley; Editing by Mrigank Dhaniwala and

Subhranshu Sahu)