TOKYO: Tokyo shares closed lower Wednesday despite troubled Chinese property giant Evergrande agreeing a deal to avoid default on a key bond, with investors also eyeing the upcoming Federal Reserve meeting.

The benchmark Nikkei 225 index lost 0.67 percent or 200.31 points to end at 29,639.40, while the broader Topix index fell 1.02 percent or 21.00 points to 2,043.55.

Lingering worries over the Evergrande crisis weighed on the market following falls in US shares, even after some Asian and European markets managed to gain overnight.

On Wall Street, the Dow lost 0.2 percent and the S&P 500 fell 0.1 percent, but the Nasdaq firmed 0.2 percent.

The worst fears over Evergrande appear to have calmed "as analysts put their faith in China's authorities to undertake an orderly restructuring," said Tapas Strickland, director of economics at National Australia Bank.

The market is now focused on any "hawkish surprise" from the US central bank, and a statement from Fed chair Jerome Powell, he added.

The Bank of Japan on Wednesday maintained its ultra-loose monetary policy to aid the economy during the pandemic.

In Tokyo trading, industrial robot maker Fanuc gave up 2.77 percent to 24,865 yen, while construction equipment maker Komatsu, which counts China as its major market, dropped 1.23 percent to 2,681 yen.

Mitsubishi UFJ Financial Group added 1.42 percent to 641.5 yen after it officially announced sales of its US unit Union Bank.Toyota fell 1.09 percent to 9,820 yen while SoftBank Group jumped 1.89 percent to 6,449 yen.

The dollar stood at 109.54 yen in Asian trade against 109.21 yen in New York Tuesday.