TOKYO, July 8 ― Tokyo stocks closed higher Friday with investors shifting their focus to the United States' monetary policy, but gains narrowed after the shooting of former prime minister Shinzo Abe.

The benchmark Nikkei 225 index added 0.10 per cent or 26.66 points to end at 26,517.19, while the broader Topix index advanced 0.27 per cent, or 5.10 points, to 1,887.43.

Abe was shot at a campaign event, as local media reported the nation's longest-serving premier was showing no vital signs.

The attack comes despite the country's famously low levels of violent crime and tough gun laws, and with politicians campaigning ahead of upper house elections on Sunday.

Before the incident, the Nikkei index rose by nearly 400 points following gains on Wall Street.

Stephen Innes, managing partner of SPI Asset Management, said in a note: "A significant focus remains on whether the Fed will hike by 50 basis points or 75 basis points in July ― with all eyes on CPI next week as an important determinant of their direction.”

"Still, I think the market may look past any higher June CPI and University of Michigan inflation expectations, given the pullback in gasoline and the stable inflation expectations.”

The dollar traded at ¥135.67 (RM4.41) in Asian trade, against ¥136.01 in New York late yesterday.

Uniqlo operator Fast Retailing rose 0.38 per cent to ¥68,260 and SoftBank Group climbed 0.22 per cent to ¥5,400.

Automakers were higher with Toyota gaining 0.28 per cent to ¥2,111, Honda jumping 1.34 per cent to ¥3,250 and Nissan advancing 0.88 per cent to ¥504.2. ― AFP