TOKYO (AP) — Asian shares mostly rose Wednesday, despite overnight losses on Wall Street and continuing fears about an outbreak of a new virus that began in China.

The Nikkei 225 rose 1.1% in morning trading to 23,453.59 after data for January showed Japan’s exports fell less than expected in January. Recent weak data readings have raised expectations the government will deploy more stimulus to counter a likely recession after the economy contracted at a 6.3% rate in the last quarter.

Australia’s S&P/ASX 200 added 0.2% to 7,128.20. South Korea’s Kospi was little changed, inching up to 2,211.25. Hong Kong’s Hang Seng added 0.4% to 27,651.41, while the Shanghai Composite edged up 0.3% to 2,994.07.

Adding to optimism, new virus cases in China have been falling, with 1,749 new infections and 136 new deaths announced after China’s leader said it was a “critical time” for disease prevention and control.

But data are showing significant disruptions to manufacturing, retailing and tourism.

“Collapse in demand due to COVID-19 remains the key worry for the markets across the globe as the disease continues its spread,” said Prakash Sakpal, economist for Asia at ING.

Japan reported its third straight month of deficit in January and like the rest of Asia is enduring a downturn in tourism thanks to controls on travel to and from China and some other parts of the region suffering from outbreaks of the virus.

Trade is likely to be a “major drag” on Japan’s economic growth this quarter, Tom Learmouth of Capital Economics said in a commentary. He is forecasting a 0.6% decrease in GDP in the January-March quarter linked to disruptions from the virus.

The gains in Asia followed a modest loss on U.S. stock indexes, which gave up some of their solid gains from the past two weeks.

Banks and technology stocks accounted for most of the decline.

The S&P 500 index fell 0.3% to 3,370.29. The benchmark index remains just below its all-time high set on Friday. The Dow Jones Industrial Average slid 0.6% to 29,232.19, while the Nasdaq recovered from an early slide, inching up 0.1% to 9,732.74.

The Russell 2000 index of smaller company stocks fell 0.2% to 1,683.52.

Monday was a holiday in the U.S. for President’s Day.

“The longer this goes on, the greater the focus is going to be on how much is this going to impact companies like Apple, which is considered not only a bellwether in tech, but a bellwether for the market overall,” said Randy Frederick, vice president of trading & derivatives at Charles Schwab.

Despite the ongoing uncertainty over the viral outbreak investors have appeared to be willing to buy back into the market after dips.

The S&P 500 has ended higher the past two weeks and is holding onto a 4.5% gain this month.

For the most part, investors are betting that the economic fallout from the outbreak will be limited to the first three months of this year, Frederick said. But if companies signal that they expect lingering effects on their business into the second quarter, investors could become less eager to jump back into the market.

“There are just so many people out there that think every dip is a buying opportunity, and so far, they’ve been rewarded,” Frederick said. “We’re going to see that for a while, until we have a really big downturn and people really get hurt by it. We just haven’t had that in a long time.”

Traders continued to assess company earnings reports. Advance Auto Parts climbed 6.2% after the auto parts supplier’s results topped Wall Street’s forecasts. Conagra Brands dropped 6.1% after the food producer cut its fiscal 2020 profit and revenue forecasts, citing surprisingly weak consumption.

Among S&P 500 companies still to release their earnings, Progressive will report on Wednesday and ViacomCBS will report on Thursday.

Financial services company Franklin Resources jumped 6.9% after saying it is buying competitor Legg Mason for $4.5 billion. The deal will create a financial company with a combined $1.5 trillion in assets under management. Legg Mason shares vaulted 24.4%.

ENERGY: Benchmark crude oil rose 53 cents to $52.82 a barrel in electronic trading on the New York Mercantile Exchange. It lost 3 cents to $52.29 per barrel on Tuesday. Brent crude oil, the international standard, rose 59 cents to $58.34 a barrel.

CURRENCIES: The dollar rose to 110.04 Japanese yen from 109.87 yen on Tuesday. The euro rose to $1.0800 from $1.0792.

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AP Business Writers Alex Veiga and Damian J. Troise contributed.