TOKYO, July 7 (Reuters) - Japan's Nikkei share average fell on Friday, tracking declines in U.S. stocks overnight after strong labour market data added to bets of additional Federal Reserve interest rate hikes.

The Nikkei lost 0.47% to 32,618.88 by the midday break. The index had fallen as much as 1.36% early in the session.

Every Nikkei sector but one entered the recess lower, led by a more than 1% slide for real estate. Financials pared early losses to end the morning flat.

Of the index's 225 components, 149 fell, 74 rose and two were flat.

The broader Topix sagged 0.39% to 2,268.10.

The Nikkei has fallen 1.72% this week, after closing at a 33-year high on Monday. Since mid-March, it has rallied nearly 27%.

"After the rally of the past three months, I think many investors are selling to take profits," said Kenji Abe, a strategist at Daiwa Securities.

"The market seems to have some concerns about the U.S. economy, but I'm optimistic for a soft landing," he added.

Abe predicted the Nikkei could fall to 31,500 this summer, but then resume its climb to reach 35,000 by year-end.

On Friday, drugmaker Eisai was the biggest percentage decliner, dropping 6.39%, despite news that its Leqembi Alzheimer's treatment won a coveted standard approval nod from the U.S. Food and Drug Administration.

While the approval was widely expected, what was unexpected was an updated label containing more stringent warnings about the risk of bleeding in the brain for some patients, Jefferies analysts wrote in a report.

"We expect sales growth to be slow and therefore rate Eisai a Hold," they said.

Peer Sumitomo Pharma was the next biggest decliner, down 2.49%.

Other notable losers included appliance makers Sharp and Panasonic, which dropped 2.23% and 2.15%, respectively. (Reporting by Kevin Buckland; Editing by Varun H K)