(Updates at 0600 GMT)

TOKYO, Nov 1 (Reuters) - Japan's Nikkei share average

closed more than 2% lower on Friday, tracking Wall Street's weak

finish overnight and pressured by a stronger yen.

The Nikkei fell 2.63% to 38,053.67 in its biggest

daily decline since Sept. 30. For the week, the index posted a

0.37% gain.

The broader Topix fell 1.9% to 2,644.26, but rose

0.99% for the week.

All three U.S. stock indexes closed lower on Thursday after

Microsoft ( MSFT ) and Meta Platforms ( META ) highlighted the

growing artificial intelligence costs that could hit their

earnings, curbing enthusiasm for megacaps that have fuelled the

market rally this year.

On Thursday, the Bank of Japan (BOJ) maintained ultra-low

interest rates as widely expected, but its less dovish remarks

lifted the yen against the U.S. dollar overnight.

A stronger Japanese currency tends to hurt exporter shares

as it decreases the value of overseas profits in yen terms when

firms repatriate them to Japan.

"BOJ Governor (Kazuo) Ueda did not use the words he used to

use yesterday, which the market took hawkish," said Shuutarou

Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

At the post-meeting news conference on Thursday, Ueda said

he will not say the BOJ can "afford to spend time" before

deciding when to shift the policy.

Some market participants took this as the BOJ opening its

doors for a rate increase as early as December.

Technology investor SoftBank Group fell 5.62%.

Uniqlo owner Fast Retailing ( FRCOF ) slipped 2.79 to drag

the Nikkei the most. Chip-testing equipment maker Advantest ( ADTTF )

fell 4.41%.

All but one of the 33 industry sub-indexes on the Tokyo

Stock Exchange fell. The glass and ceramics sector

rose 0.57%. The auto sector slipped 2.83%.

Tokai Tokyo's Yasuda said the Japanese markets would remain

volatile next week due to major events - the U.S. Federal

Reserve's policy decision and the U.S. presidential election.

(Reporting by Junko Fujita; editing by Alan Barona, Sumana

Nandy and Subhranshu Sahu)