TOKYO, March 7 (Reuters) - Japan's Nikkei share average slipped from a record high to trade lower on Thursday, as the yen strengthened amid growing expectations that the Bank of Japan would end its negative rate policy this month.
The Nikkei initially rose, tracking overnight gains of Wall Street's three major indexes, to hit a record high of 40,472.11. The index erased gains to fall 0.77% to 39,780.07 by 0213 GMT.
The broader Topix also changed course to fall 0.15% to 2,726.56.
"Investors sold chip-related and other technology shares to lock in profits as the yen strengthened after reports about the BOJ's policy tweak," said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.
Momentum is building for the BOJ to consider ending negative interest rates as soon as this month with upcoming annual wage negotiations likely to yield bumper pay hikes for the second year in a row.
BOJ board member Junko Nakagawa said the economy was moving steadily towards sustainably achieving the central bank's 2% inflation target.
Her comments followed Japan's Jiji Press's report in the previous day that some BOJ board members were likely to say that lifting negative interest rates is reasonable at a policy meeting this month.
The dollar bottomed at a roughly one-month trough of 148.94 in early Asian trade on Thursday.
Chip-testing equipment maker Advantest lost 3.49%, becoming the biggest drag on the Nikkei, followed by chip-making equipment maker Tokyo Electron, which fell 3.03%.
Bucking the trend, financial shares rose, with Mitsubishi UFJ Financial Group and Sumitomo Mitsui Financial Group rising 0.44% and 1.28%, respectively.
Of the 225 Nikkei components, 93 stocks rose and 130 fell, with two trading flat. (Reporting by Junko Fujita; Editing by Rashmi Aich)
