(Updates at 0400 GMT)

TOKYO, Aug 8 (Reuters) - Japanese shares were under

fresh pressure on Thursday as domestic chip stocks followed a

slide on Wall Street overnight and as more details from the Bank

of Japan (BOJ) pointed to hawkishness and further monetary

tightening.

The Nikkei index was volatile, trading marginally

weaker at midday as investors struggled for direction, following

its plunge on Monday and subsequent recovery.

It looked fragile, however, with expectations reviving

of more unwinding of yen carry trades after the central bank's

release of minutes of its July meeting.

At 0406 GMT, the Nikkei index was down 0.5% at 34,934. It

was at one point down as much 2.5%. Following the roller-coaster

12.4% plunge on Monday and bounce on Tuesday, the index is down

roughly 20% from its July peak above 42,000.

The broader Topix also shed 0.6% to 2,4974.76.

The volatility prompted the finance minister to say

authorities are closely watching stock market developments, but

that they are not ready to take action.

Earlier in the day, details from the Bank of Japan pointed

to hawkishness and further monetary tightening as the central

bank released minutes of its July meeting.

Some BOJ board members called for the need to keep

raising interest rates, with one saying they should eventually

be increased to at least around 1%, a summary of opinions voiced

at the July 30-31 meeting showed on Thursday.

At the July meeting, the BOJ raised its short-term policy

target to 0.25% from a range of 0% to 0.1%, driving expectations

the rate could be raised to as high as 0.5% this year.

"Worries about the BOJ's rate hike were partially eliminated

yesterday but the BOJ's stance will remain the same so the BOJ's

policy shift will be one of the negative factors for the

market," said Yugo Tsuboi, chief strategist at Daiwa Securities.

Markets had rallied and the yen had slipped on

Wednesday when the BOJ's influential Deputy Governor Shinichi

Uchida said the bank will not raise rates when markets are

unstable.

Among individual stocks, chip-making equipment maker Tokyo

Electron ( TOELF ) was last up 1.7% whereas peer Lasertec ( LSRCF )

surged 22% - giving the Nikkei its biggest boost -

after saying its annual net profit will likely rise 25%.

Nitori Holdings ( NCLTF ) jumped 9% after the home interior

goods retailer said its quarterly recurring profit rose 7.5%.

Fuji Soft was untraded amid glut of buy orders

after local media reported U.S. investment fund KKR & Co ( KKR )

plans to help the software developer go private under a

management buyout worth about 600 billion yen ($4.09 billion).

($1 = 146.6100 yen)