TOKYO, June 18 (Reuters) - Japan's Nikkei share average

rebounded and gained 1% on Tuesday, as investors bought back

stocks following the index's sharp loss in the previous session.

The Nikkei was up 1.05% to 38,504.11 by the midday

break. The index ended 1.8% lower on Monday, slipping below the

psychologically key 38,000 level for the first time this month.

The broader Topix was up 0.74% at 2,719.92.

"The Nikkei fell more than it should have in the previous

session, so investors bought back stocks," said Seiichi Suzuki,

chief equity market analyst at Tokai Tokyo Intelligence

Laboratory.

"But the market does see any good news to lift the index

further or bad news to push it lower at the moment."

Chip-making equipment maker Tokyo Electron ( TOELF ) rose

2.41% to provide the biggest boost to the Nikkei. Electronic

parts maker TDK jumped 7.22%.

Uncertainties about the Bank of Japan's policy path weighs

on investor sentiment, limiting the Nikkei's advance,

strategists said.

At its policy meeting on Friday, the BOJ said it would start

trimming its bond purchases and also announce a detailed plan in

July on reducing its nearly $5 trillion balance sheet.

"How much the BOJ will reduce the bond buying amounts will

remain unclear until the next policy meeting and the market does

not like to have uncertainties," Suzuki said.

The BOJ maintained its short-term policy rate target in a

range of 0-0.1%, as expected.

"I do not think the BOJ can raise rates as early next month,

as macro data won't not justify the rate hike," said Naoki

Fujiwara, senior general manager at Shinkin Asset Management.

Of the 225 Nikkei components, 173 stocks rose and 51 fell,

with one flat.

The pharmaceuticals sector lost 0.95% to become

the worst performer among the Tokyo Stock Exchange's 33 industry

sub-indexes.