(Updates with closing levels)

By Brigid Riley

TOKYO, May 10 (Reuters) - Japan's Nikkei share average

rebounded on Friday, buoyed by positive earnings and Wall Street

gains overnight, although profit-taking capped further advances.

The Nikkei closed 0.41% higher at 38,229.11 after

rising more than 1% early in trading.

The broader Topix finished up 0.54% at 2728.21.

The benchmark index has seen a choppy week after hitting a

three-week high of 38,863.14 on Tuesday.

Renewed bets for U.S. interest rate cuts following

softer-than-expected jobs growth in April has brightened

investor sentiment this week.

Wall Street ended higher overnight after weekly jobless

claims data added to hopes for rate cuts.

That combined with solid local earnings also buoyed the

Nikkei.

But investors locking profits as the index neared the

psychologically-significant 39,000 level in morning trading

limited gains.

The Nikkei ended nearly flat for the week, following two

straight weekly gains.

"It does look to me like we've entered a period of

consolidation," said Tony Sycamore, a market analyst at IG.

"The direction of the trend for me is higher...But just in

the next three to four months, I'd be a little bit more

cautious," as factors such as how the weak yen will impact the

economy play out, he added.

The index rose to an all-time high of 41,087.75 earlier this

year before retreating last month, when it fell 4.99% in its

biggest monthly drop since December 2022.

Among individual shares, earnings reports largely decided

the winners and losers of the day.

Gaming firms stood out, with Konami Group ( KNAMF ), up 9.3%,

leading gains. Bandai Namco Holdings ( NCBDF ) and Nintendo ( NTDOF )

also advanced, up 5.6% and 3.3%, respectively.

Electrical equipment manufacturer Daikin Industries ( DKILF )

surged 8.2%.

Chip-related Screen Holdings ( DINRF ) fell to the bottom

with a 12.2% decline. Shares of Panasonic Holdings ( PCRFF ) were

4.7% lower after the energy unit of the firm missed its

operating profit guidance for the business year.