* Investors take pause after raft of earnings reports

* U.S. GDP, jobs data in focus

* Small caps, online stocks soar on inclusion in new index

By Ayai Tomisawa

TOKYO, Nov 7 (Reuters) - Japan's Nikkei share average was

flat on Thursday as investors searched for fresh trading

opportunities after the recent flurry of earnings, while small

cap stocks rose after the Tokyo bourse said it will include them

in a new index.

The Nikkei was flat at 14,340.44 in mid-morning

trade, hovering around its 25-day moving average of 14,314.31.

On Wednesday, the index rose 0.8 percent.

"The buying has paused for now as investors are looking for

fresh macro cues," said Isao Kubo, equity strategist at Nissay

Asset Management. "Within the Japanese market, major catalysts

like earnings releases have been priced in."

Market analysts said that investors were also awaiting

Friday's U.S. nonfarm payrolls data to further gauge when the

Federal Reserve will begin winding down its $85 billion-a-month

bond-buying programme -- a major driver of risk assets in recent

years.

Global markets will also look to the first reading of U.S.

third-quarter GDP data due out later in the day.

With nearly three quarters of Nikkei companies reporting

quarterly earnings, 64 percent of them either beat or met market

expectations, according to Thomson Reuters StarMine. That

compared with 58 percent in the previous quarterly.

Bellwether exporters were mixed, with Toyota Motor Corp

falling 0.8 percent after its guidance did not meet

analysts' expectations, Nissan Motor Co rising 0.7

percent and Sony Corp shedding 0.4 percent.

The Topix shed 0.3 percent at 1,188.13.

The dollar held its ground against the yen at 98.63,

still within reach of a two-week peak of 98.86 set Friday.

Online companies such as GungHo Online Entertainment Inc

and CyberAgent Inc attracted buying after they

were included in a new index comprised of companies with high

return on equity and strong corporate governance.

GungHo rose 1.4 percent and CyberAgent gained 2.7 percent,

while J Trust Co and McDonald's Holdings Co,

which were also included, added 2.5 percent and 0.7 percent,

respectively.

On Wednesday, the Tokyo Stock Exchange and Nikkei Inc said

they will launch a new index called JPX-Nikkei Index 400 to

begin operation from the start of next year.