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

fell sharply on Monday, dropping below the key 40,000 mark as

investors sold stocks to book profits on the first day of the

country's financial year.

The Nikkei fell 1.5% to 39,765.22 by the midday

break after opening 0.7% higher. The broader Topix was

down 1.88% at 2,716.47.

"Institutional investors typically sell stocks to book

profits on the first day of the financial year," said Shoichi

Arisawa, general manager of the investment research department

at IwaiCosmo Securities.

The Nikkei is up 19% in 2024 and scaled the 40,000 mark to

hit record highs in March, after a steady 54% rise since early

2023.

Chip-related Tokyo Electron ( TOELF ) and Advantest ( ADTTF )

lost 3.34% and 4.14% respectively, becoming the biggest losers

on the Nikkei.

Toyota Motor ( TM ) fell 4.22%.

(Reporting by Junko Fujita; Editing by Varun H K)