TOKYO, July 17 (Reuters) - Japan's Nikkei share average

edged lower on Thursday, pulled down by a selloff in

chip-related shares after Dutch chip-making tool supplier ASML

sounded a revenue warning.

The tech-heavy Nikkei was down 0.3% at 39,544.62, as

of 0214 GMT, with chip-sector heavyweights Tokyo Electron ( TOELF ) and

Advantest ( ADTTF ) being the two biggest drags in the index.

The broader Topix, by contrast, eked out a 0.1%

gain.

The Nikkei's biggest decliner in percentage terms was Seven

& i Holdings ( SVNDF ), which tumbled 7.8% after Canada's

Alimentation Couche-Tard ( ANCTF ) ended its takeover bid for the

operator of the 7-Eleven convenience store chain.

Heavily weighted chip-making equipment manufacturer Tokyo

Electron ( TOELF ) lost nearly 2% and smaller peer Lasertec ( LSRCF )

tumbled 5.4%, while chip-testing machinery maker

Advantest ( ADTTF ) slid 1.8%.

ASML warned on Wednesday that it may not achieve revenue

growth in 2026 as chipmakers building factories in the U.S.

await clarity on the potential impact of tariffs.

For Japanese peers, "quarterly orders are likely to

fluctuate but, based on the 12-month moving average, orders have

not yet entered a recovery phase, similar to ASML," Jefferies

analysts wrote in a research note.

Orders for extreme ultraviolet lithography equipment, a key

component in chipmaking, have been "stalled" since increasing

"sharply" in the first half of last year, although a recovery is

likely in 2026, they said.

Taiwanese chipmaker TSMC is set to release earnings at 0530

GMT, during Japanese market hours, an event that could

potentially move the market.

Of the Nikkei's 225 components, 115 fell versus 108 that

rose, with two trading flat.

The index had been buoyed by a weakening yen earlier in the

week, but the currency was trading marginally stronger from 24

hours earlier after bouncing off a 3-1/2-month low overnight.

A decline in crude oil prices weighed on energy shares, with

the Topix oil and coal sub-index falling 1.44% to be

the worst performer among 33 industry groups. The mining

sub-index, which includes oil explorers, lost 1.40%.