A recent report on existing home sales, which fell in June, and a negative outlook voiced by Federal Reserve Chairman Ben Bernanke in recent testimony contributed to Friday's slip.
In late afternoon trading on Wall Street, the Dow Jones industrial average lost 120.79 points or 0.93 percent to 12,822.57. The Standard & Poor's 500 index lost 13.85 points or 1.01 percent to 1,362.66. Tech-heavy Nasdaq composite index gave up 40.60 points or 1.37 percent to 2,925.30.
On the New York Stock Exchange 1,024 issues advanced and 2,011 declined on volume of 3.15 billion shares.
The benchmark 10-year treasury note yielded 1.46 percent.
The euro fell to $1.216 from Thursday's $1.228. Against the yen, the dollar fell to 78.49 yen from 78.59 yen.
In Tokyo, the Nikkei 225 index lost 1.43 percent, 125.68, to 8,669.87.
In London, the FTSE 100 index slid 1.09 percent, 62.42, to 5,651.77.
2014: The Year in Music [PHOTOS]