TOKYO: Tokyo stocks closed slightly higher on Wednesday but the mood was dampened by Japan detecting its first community transmission of the Omicron coronavirus variant.

The benchmark Nikkei 225 index closed up 0.16 percent or 44.62 points at 28,562.21, while the broader Topix index ended up 0.09 percent or 1.72 points at 1,971.51.

The Japanese market started with strong gains but began to lose steam after reports emerged that community spread of Omicron had been detected in the western city of Osaka, said senior strategist Yoshihiro Ito of Okasan Online Securities.

Share prices were volatile because of thin trading volume this week, with many investors taking year-end holidays, analysts said.

The dollar fetched 114.14 in Asian trade, against 114.09 yen in New York late Tuesday.

Among major shares, Eisai was up 1.21 percent at 7,122 yen with Japan's health ministry expected to discuss the approval of an Alzheimer's treatment jointly developed by the Japanese pharmaceutical firm and its US partner Biogen.

Sony Group rallied 2.77 percent to 13,930 yen but SoftBank Group was down 0.24 percent at 5,390 yen and Toyota closed 0.68 percent lower at 2,056.5 yen.