Source: The Canadian Press

The Toronto stock market headed for a lower open Wednesday and the American dollar gained strength amid doubts about the size of another round of stimulus by the U.S. Federal Reserve.

The Canadian dollar also moved lower, down 0.52 of a cent to 97.12 cents US.

U.S. futures also pointed to a negative start to the trading day with the Dow Jones industrial futures down 44 points to 11,080, the Nasdaq futures declined 7.25 points to 2,109 while the S&P 500 futures were down 5.8 points to 1,177.

Many traders had been predicting the Fed would buy between $500 billion and $1 trillion in Treasurys to drive interest rates lower and boost lending and spending. Expectation for another round of quantitative easing had been priced into the market in recent weeks.

However, worries surfaced following a report in The Wall Street Journal that said the Fed’s bond purchases might amount to a few hundred billion dollars over several months, which would fall short of those expectations.

Expectations were also dampened somewhat by a speech earlier this week by William Dudley, the president of the Federal Reserve Bank of New York.

Dudley said further Fed action was “likely to be warranted” unless the economic outlook improved. Still, he added that the Fed “cannot wave a magic wand and make the problems remaining from the preceding period of excess vanish immediately.”

The Federal Reserve is due to decide on the new economic stimulus measures next week.

Commodity prices moved lower as the greenback gained momentum against other major currencies on doubts about the size of the Fed’s stimulus package. There have been worries that a large measure of quantitative easing would drive the value of the dollar lower.

The December crude contract on the New York Mercantile exchange fell 80 cents to US$81.75 a barrel.

Copper prices also moved down sharply with the December contract in New York down seven cents to US$3.80 a pound.

The December crude contract in New York lost $7.20 to US$1,331.40 an ounce.

Investors also took in earnings from major corporations in Canada and the U.S.

Canadian Pacific Railway’s (TSX:CP) third-quarter revenues were up 15% over last year to $1.28 billion. But net income fell to $197.3 million from $209.3 million a year earlier.

TMX Group Inc. (TSX:X), owner of Canada’s major stock exchanges, said a resurgence in trading activity in some areas and lower expenses helped drive profits to $50.8 million or 68 cents a share, compared to $41.7 million a year ago. TMX Group also raised its dividend by 5%. The showing beat analyst expectations of 64 cents per share, according to a survey by Thomson Reuters. Revenues rose 8% to $141.6 million, slightly above analyst predictions.

In the U.S., Procter & Gamble Co. says sales of its diapers, shavers and toothpaste increased around the globe. But its first-quarter net income fell 7% to US$3.08 billion or US$1.02 a share after the sale of its prescription drug business. Revenue rose nearly 2% to $20.1 billion. Analysts expected earnings of $1 per share on revenue of US$20.2 billion.

In Asia, Japan’s benchmark Nikkei 225 stock index rose 0.1%, while South Korea’s Kospi fell 0.5% after government figures showed the country’s economic growth slowed sharply in the third quarter on weaker exports and manufacturing. Asia’s fourth-largest economy expanded 0.7% in the July-September period after 1.4% growth in the previous quarter.

Hong Kong’s Hang Seng index tumbled 1.9% and mainland China’s benchmark dropped 1.5%.

London’s FTSE 100 index was down 0.51%, Frankfurt’s DAX added 0.05% while the Paris CAC 40 declined 0.34%.