Japan's Nikkei index fell to its lowest level in four months on Tuesday, October 3, as investor sentiment was affected by the rise in US Treasury bond yields and the US Federal Reserve's pledge to prolong the tightening of financial policies.

The Nikkei index extended losses in the afternoon, falling to 31,157.40 for the first time since June 1 before closing down 1.64% at 31,237.94 points.

Of the 225 companies on the index, 211 shares fell and 11 shares rose, while the shares of three companies remained unchanged.

The broader Topix index lost about 1.68%.

Ten-year Treasury yields rose to a 16-year high above 4.7% last night, pushing the yen to its lowest levels in a year at around 150 to the dollar.

Toyota Motor shares fell 3.05% and Mazda 6%.

Crude oil fell 2 percent last night after US Federal Reserve leaders pledged to tighten fiscal policy.

As a result, resources sector stocks were the worst performers. Among the 33 industrial groups on the Tokyo Stock Exchange, the mining sector led the declines, declining 6.26%, followed by the oil and coal producing sector, which fell 5.47%.