TOKYO, Oct 19 (Reuters) - Japan's Nikkei share average tumbled on Thursday, tracking a sell-off on Wall Street after robust U.S. economic data fuelled bets for a more hawkish Federal Reserve, while mounting tensions in the Middle East also heightened risk aversion.

Chip-related shares were notable underperformers after traders took cues from U.S. peers as a spike in long-term Treasury yields to 16-year peaks weighed on the so-called growth stocks.

The Nikkei was down 1.86% at 31,446.99 as of the midday break, the lowest level since Oct. 10.

Of its 225 components, 194 fell versus 30 gainers, with one flat.

Heavyweight chip-making equipment maker Tokyo Electron dropped 4.7% to be the biggest drag on the Nikkei. Chip-testing equipment maker Advantest slumped 3.4%. Lasertec and Screen Holdings fell 2.8% and 4.5%, respectively.

The broader Topix lost 1.45%.

Overnight, U.S. data showing single-family homebuilding rebounded in September fuelled the prospects of higher-for-longer rates. The 10-year U.S. Treasury yield pushed as high as 4.955% on Thursday.

On the geopolitical front, U.S. President Joe Biden flew out of Israel following a less than eight-hour visit, while protests flared around the Middle East in the aftermath of a deadly explosion at a Gaza hospital.

"The level of uncertainty is high, making it difficult to buy dips" in stock prices, said Mitsunari Akino, a director at Ichiyoshi Asset Management.

A 5% U.S. long-term yield "has come into sight," unnerving investors, he said. "Fundamentals are not bad, but it's a ripe environment for a spike in volatility."

A gauge of Nikkei volatility climbed back toward the nearly four-month high reached at the start of this month.

Automakers were among other stand-out losers, with Mitsubishi Motors diving 4.8%, Nissan slumping 3.2% and Toyota slipping 1.2%.

Among notable winners, cosmetics maker Kao and Canon each added 1.1% to be the Nikkei's top performers. Shares of Nintendo rose 0.7%.

(Reporting by Kevin Buckland; Additional reporting by Noriyuki Hirata; Editing by Sherry Jacob-Phillips)