TOKYO, Aug 15 (Reuters) - Japan's Nikkei share average rose on Tuesday to track the overnight firm finish of Wall Street as investors scooped up stocks after sharp losses in the previous session, with chip-related shares leading the gains.

The Nikkei index rose 0.8% to 32,315.61 by the midday break, regaining some of its 1.27% losses in the previous day. The broader Topix rose 0.58% to 2,294.12.

"The market rebounded from sharper-than-expected losses in the previous session, where there was no strong force to buy stocks in dips," said Seiichi Suzuki, chief equity market analyst at Tokai Tokyo Research Institute.

"Today, the Nikkei recovered some of its losses as investors bought cheap stocks. Next week, investors who are off for holiday this week will be back and they could become a strong buying force."

The S&P 500 and the Nasdaq closed higher on Monday as shares of chipmaker Nvidia surged following a bullish note from Morgan Stanley, leading gains in other megacap growth stocks. In Japan, chip-making equipment maker Tokyo Electron rose 2.29% and chip-testing making equipment maker Advantest jumped 2.76%.

Sensor maker TDK rose 2.55%.

Japan Post Holdings jumped 3.82% after the conglomerate of banks and insurance businesses announced to buy back up to 8.4% of its own shares worth 300 billion yen.

Investors' response to stronger-than-expected economic growth data was limited as the outcome was already expected, said Suzuki.

Japan's economy expanded for a third straight quarter in April-June as brisk auto exports and tourist arrivals helped offset the drag from a slowing post-COVID recovery in consumption.

Dentsu Group tanked 7.28% to become the worst performer on the Nikkei after the advertising firm cut its annual net profit forecast.

(Reporting by Junko Fujita; Editing by Sohini Goswami)