* Sapporo dives as it may have to pay additional liquor taxes
* BoFA Merrill expects Topix to trade at 1,500 in mid-2015
TOKYO, June 5 (Reuters) - Japanese stocks were choppy on Thursday, pulling away from a brief foray to a two-month high in early trade, with investors taking a breather from recent sharp gains ahead of key events, including a U.S. jobs report on Friday. The Nikkei was flat at 15,065.87 in mid-morning trade after rising to a high of 15,141.14, the best mark since April 3. The benchmark has risen nearly 7 percent in the past two and half weeks, supported by improving manufacturing data in China and an extended rally in U.S. stocks thanks to optimistic signs for the world's biggest economy. Early Thursday, however, investors were greeted by a weak services sector survey in China. HSBC/Markit's measure of the China service sector fell to 50.7 in May from April's 51.4, but still held above the 50-point level that separates growth from contraction. "Investors' risk appetites have risen, but after the sharp gains in a short period of time, they want to look for more positive cues to chase the market higher," said Takuya Takahashi, an analyst at Daiwa Securities. Analysts said traders were probably unwilling to make big bets ahead of the European Central Bank policy meeting later on Thursday and the U.S. government's May nonfarm payrolls report on Friday. Exporters were higher on the back the weak yen trend. Toyota Motor Corp gained 0.4 percent, Tokyo Electron Ltd added 0.7 percent and Panasonic Corp advanced 0.4 percent. The dollar traded at 102.70 yen, having gained more than 1 percent since Friday. But beermaker Sapporo Holdings Ltd tumbled 7.0 percent after saying that it may have to pay an additional 11.6 billion yen ($113 million) in liquor taxes. Market observers expect the Japanese market to book further gains over the long run supported by growth in companies' earnings. Bank Of America Merrill Lynch expects the Topix to reach 1,500 in mid-2015. In a report to clients, Naoki Kamiyama, head of Japan equity strategy, said the benchmark will likely rise in the July- August months, as Japanese companies are expected to get past the negative impact of the consumption tax hike as domestic demand improves. Tokyo increased the national sales tax to 8 percent from 5 percent on April 1. The broader Topix was flat at 1,233.83, while the new JPX-Nikkei Index 400 was flat at 11,249.56.
(Editing by Shri Navaratnam)