Source: The Canadian Press

The Toronto stock market was set for a higher open Friday amid comments from U.S. Federal Reserve chairman Ben Bernanke that the central bank is ready to do more to stimulate the sluggish American economy.

Bernanke said in a speech that the Fed is ready to buy Treasury bonds to spark growth. However it is still trying to figure out how big the program should be.

“There would appear — all else being equal — to be a case for further action,” Bernanke said.

Equities have been lifted strongly in recent weeks by hopes that the Fed would embark on another round of quantitative easing which involves the Fed pumping more money into the U.S. economy by purchasing government bonds and taking other measures to encourage lending. But analysts note that such a move increases the quantity of money and that lowers the value of each U.S. dollar.

Greenback weakness has pushed the Canadian dollar higher, hitting parity against the U.S. dollar briefly on Thursday. On Friday, the loonie was ahead a tenth of a cent to 99.5 cents US.

U.S. futures strengthened during Bernanke’s speech with the Dow Jones industrial futures ahead 41 points to 11,093, the Nasdaq futures added 10.5 points to 2,072.25, also supported by strong Google Inc. quarterly results. The Internet search giant’s shares surged 11% in pre-opening trading after it reported a 32-per cent jump in profit. The S&P 500 futures gained 5.1 points to 1,178.6.

Futures were getting an additional lift Friday after a report showed retail sales rose in September rose faster than economists had predicted.

A measure of inflation showed prices remain nearly stable last month. The Fed’s program would also be aimed at lifting inflation to a more historically normal level.

Oil prices moved off early lows in the wake of the Fed chairman’s comments with the November crude contract on the New York Mercantile Exchange off nine cents to US$82.60 a barrel.

Copper prices on the Nymex were ahead three cents at US$3.85 a pound while the December gold contract in New York was $2.40 lower to US$1,375.20 an ounce.

Meanwhile, PotashCorp shares (TSX:POT)(NYSE:POT) will be in focus following a report from Asia that Chinese chemicals giant Sinochem Corp. won’t make a rival bid for the Canadian fertilizer giant. Investors have been hoping for a white knight friendly offer to counter a hostile offer by Anglo-Australian miner BHP Billiton PLC, which values PotashCorp at nearly US$39-billion. Potash Corp shares were down about 0.45% in premarket trading in New York.

In Asia, Tokyo’s Nikkei 225 stock average was down 0.9%, the Shanghai index jumped over 3%, Hong Kong’s Hang Seng index fell 0.4% and Australia’s S&P/ASX 200 closed down 0.2%.

London’s FTSE 100 index was off 0.05%, Frankfurt’s DAX was ahead 0.68% and the Paris CAC 40 rose 0.19%.

In earnings news, General Electric Co. said Friday its third-quarter income fell 18% because of a loss from a Japanese division that it’s selling. The industrial and financial giant reported net income of US$2.06 billion, or 18 cents per share for the quarter. Excluding the loss from its Japan consumer finance business, GE earned 29 cents per share, two cents above Wall Street estimates. But revenue missed expectations, slipping 5% and its shares were down 2% in premarket trading.

Strong sales gains for dolls including Barbie and Disney Princesses and a tax benefit helped Mattel’s third quarter net income increase 23%. But the toymaker’s revenue missed expectations on slower international revenue growth and sales declines for Hot Wheels and continued weakness in Fisher-Price sales. Its shares dropped 8.5% in premarket trading.

Elsewhere, HudBay Minerals Inc. (TSX:HBM) said updated resource estimates for its Back Forty project in Michigan include about one million ounces of contained gold and could “significantly improve the economics” of the project.