* Investors look to Japan earnings season amid trade worries
* Asahi Group Holdings down after AB InBev deal
* Semi-conductor shares extend gains
By Hideyuki Sano
TOKYO, July 22 (Reuters) - Japanese shares dipped on Monday as hopes for a large U.S. Federal Reserve rate cut faded and investors took a cautious stance ahead of the domestic earnings seasons, which starts this week.
The Nikkei share average fell 0.23% to 21,416.79 while the broader Topix shed 0.49% to 1,556.37, with low turnover of 1.63 trillion yen, about 30% below the annual average.
On Friday, U.S. stocks fell following a Wall Street Journal report that the Federal Reserve plans to cut interest rates by only a quarter-percentage point at the end of the month.
On the whole, trading was light with many investors awaiting earnings for clues on the market, which has moved in a narrow range in the past few months on uncertainties over Sino-U.S. trade war.
"Although the U.S. and China have struck a truce on trade, the reality is that there was a tariff hike in June," said Masahiro Ayukai, senior strategist at Mitsubishi UFJ Morgan Stanley Securities.
"Japan and South Korea have spats while the world's economy is slowing down. Investors are looking to what kind of guidance companies will provide under such circumstances," he said.
Quarterly earnings reports by Japanese companies will be in full swing later this week, with Canon and Nidec announcing results after the market close on Wednesday.
The market showed no reaction to Sunday's Japanese upper house election, where Prime Minister Shinzo Abe's ruling bloc won a solid majority.
The biggest movers of the day included Asahi Group Holdings , which fell 8.9% after the beverage firm said it would buy the Australian operations of Anheuser-Busch InBev and issue up to 200 billion yen ($1.9 billion) of shares to fund it.
Bucking the broader decline, chip-related stocks extended their gains following upbeat earning guidance from Taiwan's TSMC last week.
Taiyo Yuden Co Ltd rose 3.3%, while Advantest Corp rose 1.9%, and Screen Holdings rose 2.7%.
Sanoh Industrial gained 8.4% in heavy trade, having risen 30% since Thursday, when the company announced it developed a battery cell that can directly convert heat into electricity.
Editing by Richard Borsuk and Sam Holmes