Nortel Networks Corp. and rising oil prices buoyed Canadian markets Thursday morning, while U.S. markets held on to early gains despite some worse than expected economic news.

At midday, the S&P/TSX was up 45.47 points or 0.50% to 9066.52 after a second consecutive triple-digit loss on Wednesday, while the TSX Venture Exchange slid 5.76 points or 0.33% to 1759.70. The Dow industrial average was up 43.22 points or 0.41% at 10641.05 after finishing 32.95 points lower in the previous session as investors worried about higher inflation and interest rates. It was the blue-chip index’s sixth straight losing session.

The Nasdaq composite was up 5.73 points or 0.27% at 2096.97 after slipping 16.62 points Wednesday while the Standard & Poor’s 500 index moved up 3.96 points or 0.33% at 1187.70.

The Canadian dollar continues to slide against the rallying U.S. dollar, losing three-quarters of a cent by midday to US80.81¢.

In Toronto, gains were led by the energy and information technology sectors.

Energy jumped 1.34% as oil prices shot up $1.86 to US$45.25 a barrel in electronic trading on the New York Mercantile Exchange.

Tech shares, up 1.20%, were led by Nortel shares, which jumped 2.68% to $4.21 after the company reiterated it expects to start filing of its restated financial statements on Jan. 10.

But Canadian markets were held back by the decline on gold prices. The TSX gold sector was down 0.91% as prices fell more than $5 to US$422.40 per troy ounce in London, down from $427.60 on Wednesday.

In New York, stocks advanced despite a surge in weekly jobless claims and then held in the face of the spike in oil prices.

Traders seemed unfazed by a report that initial jobless claims rose by 43,000 to a 364,000 last week — the biggest increase since the week of March 30, 2002. The increase topped forecasts of just 8,000 in new claims, and the data came a day before the crucial December unemployment report. The jump reflected the difficulty of making seasonal adjustments in weeks that include holidays, a Labor Department statistician said.

Investors are also getting the tab on how strong the 2004 holiday shopping season was as retailers report December same-store sales, or sales at outlets open for more than a year. Wal-Mart Stores said December same-store sales rose 3%, meeting the high end of forecasts, thanks to a post-Christmas shopping surge boosted in part by higher gift-card redemptions. Wal-Mart shares were up 0.49% to US$53.55.

Overseas, Tokyo’s Nikkei Stock Average rose 54.74 points, or 0.5% to finish at 11492.26. Hong Kong’s Hang Seng Index fell 52.32 points, or 0.4% to 13712.04.

London’s FTSE 100 index was up 20.9 points at 4,826.9. Frankfurt’s DAX 30 was ahead 33.84 points at 4,292.08 while the Paris CAC 40 added 27.49 points at 3,856.85.