Canadian airline stocks took flight in the wake of the apparent demise of low-cost competitor Jetsgo, helping lift the Toronto stock market Friday morning after two days of triple-digit losses. New York markets were down as U.S. investors weighed a stronger-than-expected profit forecast from Intel Corp. against a near-record trade deficit and accompanying inflation worries.

At midday, the S&P/TSX composite index was up 29.46 points or 0.3% to 9705.03 after falling energy stocks helped take the exchange down 119.57 points Thursday. The TSX Venture Exchange climbed 15.15 points or 0,78% at 1,955.31. Wall Street’s Dow industrial average was down 26.83 points or 0.25% at 10824.68 after closing up 45.89 points in the previous session. The Nasdaq slipped 10.61 points or 0.52% to 2049.11 after giving up 1.57 points Thursday. The Standard & Poor’s 500 index lost 3.86 points or 0.32% to 1205.39.

The Canadian dollar was up 0.02 to US83.07¢ despite disappointing employment and trade reports.

Shares in Air Canada holding company ACE Aviation Holdings Inc. jumped $3.11 or 9.65% to $35.35 while WestJet Airlines shares soared $3.287 or 34.65%, slightly off earlier highs, to $15.04. Both airline stocks were among the most actively traded as on noon ET — more than 4.6 million shares for ACE and 6.3 million for Westjet.

Elsewhere, the TSX also benefited from higher energy shares, up 1.45%, even though the price of oil continued to fall as investors took profits from the recent run-up. Crude oil for April delivery on the New York Mercantile Exchange was priced at US$52.99 a barrel, down 55¢ from Thursday.

On Wall Street, Intel, a Dow Jones industrial component, said late Thursday its sales for the current quarter would be at the higher end of previous forecasts, giving Wall Street hope that the technology sector’s troubles, which have included sluggish sales, may soon be resolved.

However, the Intel news failed to bolster stocks after the Commerce Department’s report on the nation’ strade gap. The trade deficit rose to $58.3 billion in January, the second highest level after November’s reading. While the nation’s exports rose to record highs, imports rose even faster, leading investors to fear a loss of confidence in the dollar overseas.

The impact of the trade deficit news on stocks was muted thanks to Federal Reserve Chairman Alan Greenspan’s comments late Thursday that the nation’s budget deficits were far more threatening to the overall economy than the trade gap.

Overseas, Japan’s Nikkei stock average rose 0.5%. In afternoon trading, Britain’s FTSE 100 was up 0.44%, Germany’s DAX index climbed 0.72%, and France’s CAC-40 gained 0.49%.