(Updates with closing prices)

By Junko Fujita

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

closed higher on Tuesday as optimism grew from reports that

Tehran is considering attending peace talks with Washington in

Pakistan, lifting risk appetite and prompting investors to buy

domestic heavyweight tech stocks.

The Nikkei rose 0.89% to 59,349.17. The broader

Topix gave up early gains to end 0.18% lower at

3,770.38.

The United States expressed confidence that peace talks with

Iran would go ahead in Pakistan and a senior Iranian official

said Tehran was considering joining, but significant hurdles and

uncertainty remained as the end of the ceasefire approached.

In Japan, chip-related shares climbed, with Tokyo Electron ( TOELF )

and Advantest ( ADTTF ) up 3.46% and 0.37%,

respectively.

Kioxia Holdings ( KXHCF ) jumped 7.31% and technology

investor SoftBank Group surged 8.53%.

"The market might be too optimistic about the aftermath of

the war. There is a concern about the impact of the disruption

of the supply chain," said Takamasa Ikeda, senior portfolio

manager at GCI Asset Management.

"There may be a big correction of the stock market in the

summer if the impact of the supply shortage surfaces."

Ikeda noted that tightened supply of helium, a key component

in cable productions, could weigh on Japan's high-performing

fibre optic cable makers, including Fujikura ( FKURF ) and

Furukawa Electric ( FUWAF ).

Fujikura ( FKURF ) rose 6.51% on Tuesday, while Furukawa gained 2.76%.

In other stock movements, Nojima ( NJMLF ) surged 14.18%

following reports that the electronics retailer plans to acquire

Hitachi's ( HTHIF ) consumer appliances unit, Hitachi Global Life

Solutions, for more than 100 billion yen ($630.32 million).

Hitachi ( HTHIF ) shares edged 0.7% higher.

Banking shares declined, with Mitsubishi UFJ Financial Group ( MUFG )

and Mizuho Financial Group ( MFG ) down 1.39% and

1.89%, respectively.

Toyota Motor ( TM ) lost 3.24% in early trade.

Of the more than 1,600 stocks traded on the Tokyo Stock

Exchange's prime market, 32% rose, 64% declined and 3% remained

unchanged.