TOKYO (Kyodo) -- Tokyo stocks eked out small gains Friday with banks bought on higher interest rates while concerns over political uncertainty weighed on the market ahead of a general election in Japan.

The 225-issue Nikkei Stock Average ended up 70.56 points, or 0.18 percent, from Thursday at 38,981.75. The broader Topix index finished 1.15 points, or 0.04 percent, higher at 2,688.98.

On the top-tier Prime Market, gainers were led by pharmaceutical, machinery and bank issues.

The U.S. dollar topped the 150 yen line overnight but weakened to trade largely in the upper 149 yen range in Tokyo after Japan's top currency diplomat Atsushi Mimura 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 that the pace of interest rate cuts in the United States will be slow.

At 5 p.m., the dollar fetched 150.08-11 yen compared with 150.19-29 yen in New York and 149.76-78 yen in Tokyo at 5 p.m. Thursday.

The euro was quoted at $1.0840-0842 and 162.70-74 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.

The yield on the benchmark 10-year Japanese government bond ended at 0.965 percent, up 0.005 percentage point from Thursday's close. The debt was sold, sending yields higher, on an overnight rise in long-term U.S. Treasury yields.

Stocks were initially boosted by Wall Street gains overnight and buying of exporters on the yen's depreciation, which inflates their overseas profits when repatriated. Bank issues also climbed on hopes for improved profits as yields rose.

But the Nikkei index gave up most of its gains in the afternoon as many export-oriented auto and electronics issues erased advances as the yen strengthened against the dollar.

Investors also grew cautious before the Oct. 27 election as some polls suggested that the ruling Liberal Democratic Party could lose its majority in the powerful House of Representatives, analysts said.

"Active trading appeared to be quite limited as investors began pricing in a scenario where the LDP fails to keep its majority, leading to political uncertainty," said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.