TOKYO (Kyodo) -- Tokyo stocks rose slightly Friday morning, as banks gained on higher interest rates, while deepening uncertainty over the outcome of Japan's general election kept investors on the sidelines.

The 225-issue Nikkei Stock Average rose 147.13 points, or 0.38 percent, from Thursday to 39,058.32. The broader Topix index was up 8.23 points, or 0.31 percent, at 2,696.06.

The U.S. dollar topped the 150 yen line overnight but weakened to the upper 149 yen range in Tokyo on yen buying after Japan's top currency diplomat said the government is monitoring currency movements with a "high sense of urgency."

The dollar exceeded the key level for the first time since early August, with stronger-than-expected U.S. September retail sales reinforcing bets the pace of interest rate cuts in the United States will be slow.

At noon, the dollar fetched 149.92-94 yen compared 150.19-29 yen in New York and 149.76-78 yen in Tokyo at 5 p.m. Thursday.

The euro was quoted at $1.0838-0839 and 162.48-52 yen against $1.0825-0835 and 162.65-75 yen in New York and $1.0853-0854 and 162.54-58 yen in Tokyo late Thursday afternoon.

Stocks were supported by gains on Wall Street overnight, while banking stocks climbed on hopes for improved profits after long-term bond yields tracked higher interest rates in the United States.

But gains were limited amid uncertainty over Japan's Oct. 27 general election, as multiple media polls suggested the ruling Liberal Democratic Party and its coalition partner could struggle to keep a majority in the powerful House of Representatives.

"Overseas investors are wary about what is to come if the LDP fails to stay in power after the election," said Toshikazu Horiuchi, an equity strategist at IwaiCosmo Securities Co.