TOKYO: Tokyo stocks closed slightly higher Tuesday on bargain-hunting, but investors remain cautious with virus cases rising as the Olympics approach.

The Nikkei 225 index edged up 0.16 percent, or 45.02 points, to 28,643.21 while the broader Topix index rose 0.28 percent, or 5.51 points, to 1,954.50.

"Investors bought back following recent declines, partially encouraged by the previous day's gains in European shares," Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP.

"But uncertainty over the Olympics and rising coronavirus cases in Tokyo weighed on the market."

Japan's government is reportedly considering extending virus measures in Tokyo until after the Olympics begin on June 23.

A newspaper report said fans are likely to be banned from the opening ceremony over virus fears, but a reduced number of VIPs and Olympic officials will be able to attend.

Investors were also waiting for the minutes from the Federal Reserve's June policy meeting, which will be released on Wednesday, analysts said.

The dollar stood at 110.79 yen in Asian afternoon trade, compared with 110.92 yen Monday.

In Tokyo, SoftBank Group gained 1.00 percent to 7,465 yen. The firm plunged more than five percent Monday after Chinese authorities ordered ride-hailing firm Didi Chuxing -- of which SoftBank is a major stakeholder -- be removed from app stores over security concerns.

Internet service provider Z Holdings, the parent company of Yahoo Japan, rose 1.08 percent to 551.9 yen after agreeing to acquire the brand's trademark rights in the country.

Uniqlo operator Fast Retailing, which lost nearly two percent on Monday, gained 0.45 percent to 81,870 yen.

Nintendo jumped 2.47 percent to 66,760 yen and Toyota rose 0.22 percent to 9,794 yen.