However, there are concerns that trade friction with the USA could affect demand for exports.
The economists polled by Reuters were expecting a 0.2 percent contraction following a downwardly revised 0.6 percent annualized rate of expansion in the fourth quarter.
"But we need to be mindful of the impact of overseas economic uncertainty and market volatility", he said. To get back on track, Japan needs to increase its exports.
GDP is expected to be flat on quarter and slip 0.1% on year after adding 0.4% on quarter and 1.6% on year in the three months prior.
Slower export growth reflected a decline in shipments of mobile phone parts and factory equipment in the quarter, a government official said. "However, it is clear that in the long term the pace of growth is slowing".
Boeing, Airbus both find positives in WTO subsidy ruling
Boeing fell less than 1 percent to $342.10 at 11:43 a.m.in NY . "The Airbus case against Boeing is yet to come". The bloc compounded the issue with below-market loans for the plane-maker's marquee A350 jetliner.
The first-quarter contraction could make Japanese politicians more reluctant to implement a hike in sales tax to 10 percent from the current 8 percent scheduled for next year.
Domestic demand lopped 0.2 percentage points (ppts) of quarterly growth, driven lower by declines in housing investment and private business inventories.
As of 9:15 a.m. local time, the 225-issue Nikkei Stock Average dropped 47.21 points, or 0.21 percent, from Tuesday to 22,770.81.
The world's third-largest economy is shrinking again.
That snaps a run of eight quarters of consecutive growth, the longest Japan has achieved since the boom days of the late 1980s.