OPEC’s announcement that it will reduce the flow starting at the first of the year drove oil prices higher Friday morning and helped keep Canadian markets in positive territory. But the news was not what U.S. investors wanted to hear.

At midday, Toronto’s S&P/TSX composite index was up 1.37 points or 0.02% at 9014.92 after rising 9.81 points Thursday. The TSX Venture Exchange climbed 6.69 points or 0.39% at 1702.89. The Dow Jones industrials slipped 19.36 points or 0.18% to 10533.46 after climbing 58.59 points in the previous session. The Nasdaq was off 4.04 points or 0.19% to 2124.97 and the S&P 500 lost 2.50 points or 0.21% at 1186.74.

The Canadian dollar lost ground for a fifth straight day as the U.S. dollar continued to rally and investors reacted to the Bank of Canada’s decision this week to put interest rates on hold. The C$ was trading at US81.48¢, down 0.45 of a cent from Thursday’s close.

The Organization of Petroleum Exporting Countries said Friday it will reduce output by one million barrels a day in hopes of staving off price declines, a decision which drove light sweet crude for January delivery up 55¢ to US$43.08 a barrel on the New York Mercantile Exchange.

Saudi Oil Minister Ali Naimi said OPEC will meet again at the end of January to review prices. Up until the middle of this week, oil prices had fallen sharply recently as warmer weather resulted in increased heating oil supplies in the U.S.

On Bay Street, energy stocks lead the way higher, gaining 0.37% on the TSX. But they were held back by financial stocks, which lost 0.37%. Among the bigger decliners was newly listed ING Canada Inc., which began trading Friday. It was off 3.3% to $28.01 from its $29 opening price. Trading was heavy with more than 9.7 million shares exchanging hands.

In New York, oil prices were not the only cause for investor concern. Stocks edged lower in morning trading Friday as investors worried that a jump in wholesale prices could lead to inflation. A bullish reading of consumer sentiment, however, helped limit the losses.

Investors were rattled by the Labor Department’s latest Producer Price Index report, which measures wholesale prices. The PPI rose 0.5% in November, far less than October’s 1.7% rise, but still a troublesome indicator of possible inflation.

The University of Michigan’s latest consumer sentiment index reading helped assuage some fears, as the index rose to 95.7 from 92.8 in November. Economists had expected a reading of 93.2, and the index’s gains bode well for increased consumer spending this month.

Declining issues outnumbered advancers by about 5 to 3 on the New York Stock Exchange, where volume came to 421.59 million shares, compared with 476.19 million at the same point Thursday.

Overseas, Japan’s Nikkei stock average fell 0.18%. In afternoon trading, Britain’s FTSE 100 was up 0.25%, Germany’s DAX index rose 0.6%, and France’s CAC-40 gained 0.53%.