TOKYO, March 4 (Xinhua) -- Tokyo stocks closed sharply lower Thursday, with the benchmark Nikkei stock index dropping to a one-month low, as investor sentiment was dented by recent market volatility amid a sharp rise in U.S. borrowing costs.

The 225-issue Nikkei Stock Average dropped 628.99 points, or 2.13 percent, from Wednesday to end the day at 28,930.11, marking its lowest closing level since Feb. 5.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, lost 19.80 points, or 1.04 percent, to finish at 1,884.74.

Local brokers said that investor appetite to chase bargains was diminished amid concerns over surging interest rates in the U.S. sparking market volatility and clouding the outlook for corporate earnings and the broader outlook for the world's largest economy.

"There are uncertainties in the move of U.S. bond yields, which has made the market outlook unclear," Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management, was quoted as saying.

Coupled with concerns over a spike in U.S. bond yields, which hit cyclical issues, investors were also in a risk-off mood ahead of key U.S. jobs data due out Friday.

Wall Street's negative lead overnight, with the tech-heavy Nasdaq composite index dropping below the 13,000 mark for the first time in more than a month, triggered selling here, traders here also added.

"Selling triggered selling. Many high-priced issues that have a large effect on the Nikkei tend to move in tandem with the Nasdaq," Yutaka Miura, senior technical analyst at Mizuho Securities Co., was quoted as saying.

By the close of play, nonferrous metal, information and communication, and air transportation issues comprised those that declined the most.

Large-capped issues lost ground, with Nikkei heavyweight Fast Retailing, operator of the Uniqlo chain of casual clothing stores, falling 5.5 percent.

Similarly, heavily weighted component SoftBank Group dropped 5.2 percent, while chip equipment maker Tokyo Electron was another notable decliner, ending the day 2.4 percent lower.

Following Japan's Prime Minister Yoshihide Suga saying the previous day it would be necessary to extend the COVID-19 state of emergency for the greater Tokyo area for about two weeks beyond its initial deadline this Sunday, travel agencies traded lower.

Travel and tour services business Knt-Ct Holdings retreated 2.3 percent, while low-cost package tour company H.I.S. slumped 4.2 percent by the close.

Bucking the downward trend, shipping firms rose, with Mitsui OSK Lines gaining 3.6 percent, Nippon Yusen adding 2.8 percent, while Kawasaki Kisen closed 6 percent higher.

Issues that fell outpaced those that rose by 1,295 to 787 on the First section, while 112 ended the day unchanged.

On the main section on Thursday, 1,285.61 million shares changed hands, rising from Wednesday's volume of 1,206.50 million shares.

The turnover on the penultimate trading day of the week came to 2,761.265 billion yen (25.726 billion U.S. dollars). Enditem

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