A man looks at his watch as he passes an electronic board displaying a graph of currency rates outside a brokerage in Tokyo.

Tokyo stocks closed 0.99 percent lower on Friday, giving up morning gains as divided US lawmakers appeared set to head home for the holiday break without a deal on the fiscal cliff.

The benchmark Nikkei 225 index slipped 99.27 points to 9,940.06, while the broader Topix index of all first-section shares was off 0.70 percent, or 5.89 points, at 832.72. - Sapa-AFP