By Michael Connor

NEW YORK (Reuters) – European stocks hit seven-year highs on Friday, continuing a rally ignited by the European Central Bank’s plan for massive regional economic stimuli that also knocked the euro to 11-year lows.

Wall Street mostly fell on soft corporate earnings news after the S&P 500 rallied 1.5 percent on Thursday on the ECB’s $ 1 trillion bond-buying announcement.

The euro went into another nose-dive, hitting a low of $ 1.1115 in its biggest daily fall in over three years, before recovering somewhat. The euro was last off 1.3 percent at $ 1.1218. [FRX/]

The currency has lost more than 7 percent since the start of the year and is on track for its biggest monthly fall since the depths of the financial crisis in early 2009.

“We are in an avalanche of euro selling,” said Boris Schlossberg, managing director of currency strategy at BK Asset Management in New York.

U.S. Treasury debt prices jumped as European yields touched record lows and left America’s higher interest rates even more attractive to investors.

Oil prices were buoyed by hopes for a boost to global growth from the ECB’s move, though the death of Saudi Arabia’s King Abdullah added to uncertainty over the plans of the world’s biggest crude exporter.

The FTSEurofirst 300 <.FTEU3> index of top European shares closed up 1.8 percent at 1,479.51 points, a seven-year high. The index rose 5.1 percent this week, its strongest week since December 2011.

U.S. stocks were mostly down for much of Friday, partly on worries the surging dollar will hurt U.S. corporate earnings. The Dow Jones industrial average <.DJI> finished unofficially off 141.38 points, or 0.79 percent, to 17,672.6, the S&P 500 <.SPX> closed down 11.33 points, or 0.55 percent, to 2,051.82, and the Nasdaq Composite <.IXIC> added 7.48 points, or 0.16 percent, to 4,757.88.

For the week, the Dow rose 0.9 percent, the S&P gained 1.6 percent and the Nasdaq added 2.7 percent.

United Parcel Service Inc shares fell nearly 10 percent after the delivery giant gave a fourth-quarter earnings outlook below expectations. [ID:nL1N0V20X3]

“Valuations in the U.S. market are only okay, and you have to make sure you’re factoring in the impact from currencies, which will really be a headwind for multinationals,” said David Lafferty, chief market strategist of Natixis Global Asset Management in Boston.

Long-dated bonds led a U.S. debt rally and the yield curve flattened. Benchmark 10-year notes gained 29/32 in price to yield 1.79 percent, far higher than comparable German debt yields , which fell to record lows of 0.312 percent on Friday.

Thirty-year bonds gained 2-8/32 in price to yield 2.37 percent, down from 2.47 percent late on Thursday.

“The U.S. market can’t go down. There are too many flows into U.S. Treasuries because we’re the highest-yielding currency there is,” said Tom di Galoma, head of rates and credit trading at ED&F Man Capital Markets in New York.

Brent crude oil rose. The death of Saudi Arabia’s king added to uncertainty in oil markets, although the new ruler indicated immediately there would be no policy change. Brent rose nearly 1 percent to $ 48.93. [ID:nL6N0V21V]

(Reporting By Michael Connor in New York; Editing by Chizu Nomiyama and Leslie Adler)