TOKYO: Tokyo stocks closed higher Tuesday as investors continued buying back following recent declines, taking heart from rallies on Wall Street. The benchmark Nikkei 225 index rose 0.87 percent, or 237.86 points, to 27,732.10, while the broader Topix index gained 1.00 percent, or 19.06 points, to 1,934.20.

"US rallies prompted investors to continue buying back shares following last week's declines," Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP.

"The market has shifted its focus to Jackson Hole" where Federal Reserve boss Jerome Powell will make a policy speech later this week, Horiuchi said.

Trading is expected to be range-bound for the rest of the week "as profit-taking can easily emerge at this level," he added.

The dollar fetched 109.78 yen in Asian afternoon trade, against 109.67 yen in New York.

In Tokyo, chip-related shares gained ground. Chip-testing equipment maker Advantest jumped 1.79 percent to 9,050 yen with chip-making equipment manufacturer Tokyo Electron up 1.99 percent at 44,970 yen.

Panasonic rose 0.32 percent to 1,254 yen after a report the Osaka-based company plans to move the headquarters of its mainstay business to Tokyo.