TOKYO: Tokyo stocks opened higher but dipped into negative territory quickly on Thursday, as worries about a potential US government shutdown overwhelmed support from a cheaper yen.

The benchmark Nikkei 225 index was down 0.10 percent, or 28.84 points, at 29,515.45 about half an hour after the opening bell, while the broader Topix index traded down 0.18 percent, or 3.58 points, at 2,034.71.

Investors remain cautious ahead of the deadline for the US debt ceiling bill later in the day, fearing a potential government shutdown, analysts said.

"As for whether the US can avoid a government shutdown, focus today will be on Congress passing a continuing resolution before the end of Thursday to fund the government through to December 3," senior analyst Tapas Strickland of National Australia Bank said in a note.

Democrats announced that the US Senate will vote Thursday on legislation to fund federal agencies, which is likely to avert the shutdown.

The dollar fetched 111.90 yen against 111.98 yen in New York and 111.43 yen in late Tokyo hours on Wednesday.

There was no strong reaction to Japan's ruling Liberal Democratic Party choosing Fumio Kishida as their new leader and the country's next prime minister.

Seen as a safe pair of hands likely to continue existing government policy, Kishida will be approved as prime minister by parliament on October 4.

On Wall Street, stocks closed mixed with the benchmark Dow ending up 0.3 percent at 34,390.72 but tech shares falling again, as investors reassess equity bets in the expectation of higher interest rates.

In Tokyo, shipping firms dived with Mitsui O.S.K. Lines dropping 7.21 percent to 7,840 yen and Nippon Yusen down 7.80 percent at 8,630 yen.

Many other exporters were lower, with Nippon Steel trading down 2.19 percent at 2,019 yen, Toyota slipping 2.55 percent to 2,020 yen and Sony off 0.84 percent at 12,335 yen.