TOKYO, April 2 (Reuters) - Japan's Nikkei share average

rebounded on Tuesday, briefly scaling 40,000 points as traders

bought on the dip before easing back due to the risk of currency

intervention by the central bank.

The Nikkei was up 0.13% at 39,853.20 at the midday

break, bouncing back after profit-booking pushed it to a

two-week low on Monday.

The index is up about 19% this year and scaled the 40,000

mark to record highs last month.

Traders took advantage of the drop in the previous session

to buy stocks, boosting many big-name companies.

Uniqlo parent firm Fast Retailing ( FRCOF ) was up 0.3% and

chip-making equipment giant Tokyo Electron ( TOELF ) gained 3.2%.

Technology-related stocks were the largest lift to the

index, receiving a tailwind from their U.S. peers as the AI

frenzy continued to boost the U.S. semiconductors index.

Chip-testing equipment maker Lasertec ( LSRCF ) and Shin-Etsu

Chemical ( SHECF ), which manufactures semiconductor silicon

products, rose 1.8% and 0.8%, respectively.

The yen's weakness, which boosts exporters' profits, was a

double-edged sword as the risk of currency intervention weighed

on the overall index, said Masahiro Ichikawa, chief market

strategist at Sumitomo Mitsui DS Asset Management.

"If the yen were to appreciate rapidly due to intervention,

there is a strong possibility that the Nikkei could fall."

That's created a "heightened sense of caution," which could

make it difficult for the index to keep in the 40,000-point

range for now, Ichikawa said.

Japanese Finance Minister Shunichi Suzuki said on Tuesday

that authorities were ready to take appropriate action against

excessive currency market volatility, without ruling out any

options.

The broader Topix was down 0.2%.