TOKYO: Tokyo shares closed lower on Wednesday with high-tech shares down on worries over rising US interest rates.

The benchmark Nikkei 225 index lost 1.58 percent, or 471.45 points, to end at 29,302.66, while the broader Topix index fell 1.16 percent, or 23.70 points, to 2,019.12.

"Chip-related shares and shares of growing companies were sold on the back of higher US interest rates," Okasan Online Securities said in a note after shares on the tech-rich Nasdaq slumped on rate concerns.

The dollar fetched 114.92 yen in Asian trade, against 115.11 yen in New York late Tuesday. The greenback broke the 115 yen mark for the first time in more than four years on Tuesday.

Japan announced on Wednesday that it will release some of its oil reserve -- reportedly around 4.2 million barrels -- as part of a coordinated plan led by the United States to tackle surging prices.

However, oil prices rallied overnight and the buying continued in Asian trade, despite US President Joe Biden's announcement that Washington will release 50 million barrels of crude from strategic reserves.

Chip-linked shares were also weighed down by a report that said the Japanese government plans to earmark 60 billion yen ($520 million) to establish a fund to support companies that produce cutting edge semiconductors.

Chip-maker Renesas Electronics plunged 4.24 percent to 1,488 yen and chip-testing equipment maker Advantest dropped 4.08 percent to 10,100 yen.

SoftBank Group tumbled 3.31 percent to 6,596 yen while Uniqlo operator Fast Retailer lost 1.65 percent to 72,890 yen.

Oil-linked shares were higher with energy developer INPEX jumping 3.80 percent to 955 yen and top refiner ENEOS Holdings climbing 0.92 percent to 436.3 yen.

Its smaller rival Idemitsu Kosan gained 0.87 percent to 3,005 yen.