(Updates for close)

By Rocky Swift

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

fell on Wednesday as traders locked in recent gains and

appreciation in the yen sapped demand for exporters.

Tokio Marine Holdings ( TKOMF ) sank 2.6% and triggered a

decline in insurance companies after forecasting a 12% drop in

annual profit. Mizuho surged 2.7%, leading banks higher

after announcing a plan to shed cross-shareholdings.

The benchmark Nikkei has climbed 4.4% since U.S.

President Donald Trump announced sweeping tariffs on April 2,

only to pause most of them as he sought bilateral trade deals.

"Stocks have been on a rise, but now that earnings have come

to an end, I think there's a slight lack of catalysts in the

market," said Wataru Akiyama, a strategist at Nomura Securities.

"We may be seeing an adjustment in the stock market after

the recent rally has led to short-term overheating."

Japan's export-reliant economy and equity market are still

vulnerable to how trade talks with the U.S. pan out. The

nation's lead trade negotiator, Ryosei Akazawa, will head to the

U.S. on Friday for a third round of talks, the Nikkei newspaper

reported.

Data on Wednesday showed Japanese exports rose for the

seventh straight month in April but shipments to the U.S. fell,

highlighting the toll of Trump's tariffs.

The Nikkei extended losses in the afternoon session as the

yen advanced, closing 0.6% lower. The broader Topix lost

0.2%.

There were 121 advancers against 102 decliners on the

Nikkei, which is still down almost 6.5% this year.

(Reporting by Rocky Swift; Editing by Mrigank Dhaniwala and

Varun H K)