Tokyo's key Nikkei index zigzagged between positive and negative territory at the open on Tuesday, with investors cautious ahead of a key Federal Reserve decision.

The benchmark Nikkei 225 index edged up 0.01 percent, or 3.58 points, to 27,702.83 in early trade, while the broader Topix index inched up 0.09 percent, or 1.82 points, to 1,945.03.

The dollar stood at 136.37 yen, against 136.65 yen in New York Monday.

"The Japan market today is likely to develop in a directionless manner," Okasan Online Securities said in a note, citing thin trading ahead of the US central bank's expected move to lift interest rates again.

The Fed is widely tipped to hike borrowing costs by 0.75 percentage points Wednesday as it battles soaring inflation.

But with the Fed decision as yet unconfirmed, investors "are in a situation where they are hard-pressed to decide on their positions," the brokerage said, predicting "light trading will continue."

The view was echoed by senior market analyst Toshiyuki Kanayama of Monex.

"The wait-and-see mood will remain strong today," he said in a note.

Among major shares in Tokyo, Toyota edged up 0.13 percent to 2,169.0 yen, SoftBank advanced 2.28 percent to 5,631 yen and Sony Group slipped 0.51 percent to 11,645 yen.

Uniqlo operator Fast Retailing inched down 0.27 percent to 79,560 yen.

tmo/sah/cwl

FAST RETAILING

TOYOTA MOTOR

SOFTBANK GROUP

SONY