World stocks fell on Friday as investors took a dim view of U.S. corporate earnings after General Electric and McDonald’s disappointed and shrugged off improving signs in Europe’s debt saga, which helped boost government bond prices.

The euro fell to a session low against the dollar as risk appetite eased after a report showed U.S. home resales fell in September, a reminder that America’s housing sector is a long way from a full recovery.

The euro was last down 0.3 percent at $1.3029 after falling as low as $1.3018. Revenue missed analysts’ expectations at GE due to unfavorable Stock exchange rates, while McDonald’s profits also missed expectations because of the weak global economy.

Of the 116 S&P 500 companies that have reported so far in the U.S. earnings season, 60 percent have exceeded analysts’ estimates, a rate lower than the 67 percent pace of the previous four quarters, according to Thomson Reuters data.

The Dow Jones industrial average was down 109.01 points, or 0.80 percent, at 13,439.93. The Standard & Poor’s 500 Index was down 11.04 points, or 0.76 percent, at 1,446.30. The Nasdaq Composite Index was down 31.07 points, or 1.01 percent, at 3,041.80. MSCI’s all-country world equity index was down 0.7 percent at 335.71. In Europe, the pan-regional Euro STOXX 50 was down 1.1 percent.

U.S. Treasury prices edged up as selling pressure that has hurt the market the past four days subsided. Recent stronger U.S. economic data and hopes that European leaders are taking steps to resolve their debt crisis caused a dramatic jump in Treasuries yields this week amid heavy selling of the debt.

The market is also now pricing in an expectation that the Federal Reserve will start raising rates in 2014, instead of 2015, for the first time since before Fed Chairman Ben Bernanke’s speech in Jackson Hole in August, said Jim Vogel, interest rate strategist at FTN Financial in Memphis, Tennessee.

The question everyone is asking is ‘Was QE3 even necessary?’ given that we are already seeing evidence of a nice third-quarter rebound, he said. The benchmark 10-year U.S. Treasury note was up 9/32 to yield 1.7993 percent. Brent oil prices traded near break-even. December Brent crude oil futures were up 4 cents at $112.46 a barrel, while U.S. crude fell 4 cents at $92.06 a barrel.