(Updates with closing levels)

By Brigid Riley

TOKYO, May 23 (Reuters) - Japan's Nikkei share average

rose on Thursday to finish at more than a one-month closing high

as technology stocks rallied after U.S. peer Nvidia's ( NVDA ) earnings

delivered on sky-high expectations.

Markets were not disappointed in the week's most closely

watched event, with Nvidia ( NVDA ) hitting a record high after

the U.S. chipmaker forecasted quarterly revenue above estimates

on Wednesday and announced a stock split.

"Nvidia ( NVDA ) earnings were better than expected. So that was

definitely positive for Japanese tech stocks, especially

semiconductor-related companies," said Kenji Abe, equities

analyst at Daiwa Securities.

Japan's tech shares rallied on the news, buoying the Nikkei

share average to end up 1.26% at 39,103.22, its highest

closing level since April 15.

The broader Topix closed 0.64% higher at 2754.75.

Chip-related shares have been among the Nikkei's best

performers over the past year, helping the benchmark index climb

to a record intraday high of 41,087.75 in March.

Gains were more subdued outside of tech on Thursday as

investors remained cautious regarding the Bank of Japan's policy

path, analysts said.

Japan's 10-year government bond yield rose to the

psychologically significant 1% mark on Wednesday, renewing

concerns in the wake of the BOJ's recent hawkish signals,

including an unexpected cut to its bond offer amounts last week.

Positive sentiment picked up in the afternoon session,

however, with 145 of the benchmark index's 225 constituents

advancing.

On Thursday, Advantest ( ADTTF ), which counts Nvidia ( NVDA ) among

its customers, jumped 5.4% to contribute about 78 points to the

Nikkei's 486-point gain.

AI-focused startup investor SoftBank Group, up

4.3%, and chip-making equipment giant Tokyo Electron ( TOELF ),

climbing 1.8%, together added nearly 134 points.

Chip equipment manufacturers Disco Corp ( DISPF ) and

Lasertec ( LSRCF ) also surged, gaining 8% and 6.3%,

respectively.

Among decliners, videogame maker Nexon ( NEXOF ) slid 5.6% to

the bottom of the pack, while Chugai Pharmaceutical ( CHGCF )

lost 1.2%. Fellow pharmaceutical firm Daiichi Sankyo ( DSKYF )

was down 0.9%.