TOKYO, March 14 (Reuters) - Japan's Nikkei share average

reversed course to trade higher on Friday, as investors

purchased chip-related stocks and other undervalued shares,

although concerns over the U.S. economic outlook limited further

gains.

The Nikkei was up 0.35% at 36,919.12 by the midday

break, while the broader Topix traded 0.4% higher at

2,709.04.

"The market is concerned about uncertainties about the U.S.

economy, and that weighed on stocks in the U.S. and Japan," said

Takamasa Ikeda, senior portfolio manager at GCI Asset

Management.

"But losses are also limited as there is a demand from

institutional investors, such as pension funds, who want to buy

stocks to rebalance their portfolios at the end of Japan's

fiscal year," said Ikeda.

Chip-testing equipment maker Advantest ( ADTTF ) jumped 4%,

providing the biggest boost to the Nikkei, while Toyota Motor ( TM )

climbed 2.1%.

Fujikura ( FKURF ), a cable maker and a gauge for data centre

investments, jumped 4.5%.

Shares of Canon climbed 3.2% after the Japanese

camera maker launched plans to buy back up to 2.8% of its

shares.

In addition to fears of the impact of U.S. President Donald

Trump's tariff threats, his comments about the U.S. recession at

Fox News interview weighed on the sentiment of equity investors,

said Hiroyuki Ueno, chief strategist at Sumitomo Mitsui Trust

Asset Management.

"But I think the market could turn its course after April 2

when Trump has vowed to impose reciprocal tariffs on the U.S.

trading partners," Ueno said.

Staffing agency Recruit Holdings ( RCRRF ) fell nearly 3% to

weigh on the Nikkei the most. Uniqlo-brand Fast Retailing ( FRCOF )

lost 0.2%.

Of all the 225 components on the Nikkei, 139 stocks rose and

82 fell, with four were trading flat.