(Updates at 0230 GMT)

TOKYO, Oct 8 (Reuters) - Japan's Nikkei share average

fell on Tuesday and seemed set to snap a three-day winning run,

weighed down by Wall Street's weaker finish overnight and a

stronger yen.

The Nikkei was down 1.2% at 38,861.09 by the midday

break, after rising 1.8% on Monday. The index has jumped 4% over

the last three sessions.

"Japanese stocks retreated as overnight declines of Wall

Street prompted investors to book profits from their three-day

rally," said Naoki Fujiwara, senior general manager at Shinkin

Asset Management.

"Also a stronger yen weighed on sentiment," he said.

Wall Street's three major indexes closed down around 1% as

traders tamped down bets for Federal Reserve interest-rate

easing and worried about the Middle East conflict's impact on

oil prices.

The yen was 0.37% higher at 147.65 per dollar in

early trading, after slumping to a seven-week low of 149.10 on

Monday.

A stronger yen tends to hurt exporters' shares, as it

decreases the value of overseas profits in yen terms when firms

repatriate them to Japan.

The broader Topix fell 1.55% to 2,697.01, with

Toyota Motor ( TM ) falling 3.19% to drag the index the most.

Sony Group ( SONY ) fell 2.66%.

Technology startup investor SoftBank Group fell

2.71% to drag the Nikkei the most. Chip-making equipment maker

Tokyo Electron ( TOELF ) and Uniqlo brand owner Fast Retailing ( FRCOF )

slipped 1.47% and 0.61%, respectively.

All but three of the Tokyo Stock Exchange's 33 industry

sub-indexes fell, with the brokerage sector declining

2.86% to become the worst performer. The banking sector

lost 2.68%.

Of more than 1,600 stocks listed on the TSE's prime market,

83% fell, while 15% rose and 1% were flat.

(Reporting by Junko Fujita; Editing by Subhranshu Sahu and

Varun H K)