US STOCKS-Wall St slides after Trump's positive COVID-19 test

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* News could hurt Trump's election campaigning ability -
analysts
* U.S. jobs growth slows more than expected in September
* Banks track Treasury yields lower
* Airlines tumble as stimulus deal remains elusive
* Indexes down: Dow 0.99%, S&P 1.25%, Nasdaq 1.68%

(Updates to open)
By Sagarika Jaisinghani and Devik Jain
Oct 2 (Reuters) - Wall Street's main indexes tumbled at the
open on Friday after President Donald Trump tested positive for
COVID-19 weeks before the election, with an elusive fiscal
stimulus and a slowdown in the domestic economic recovery also
denting sentiment.
All 11 major S&P sectors were down, with energy .SPNY
sliding 1.5% on the back of a more than 3% drop in oil prices.
O/R
Utilities .SPLRCU , healthcare .SPXHC and consumer
staples .SPLRCS were among the smallest decliners in early
trading.
Trump's tweet that he and first lady Melania had contracted
the disease rankled global financial markets and sent investors
scurrying to the perceived safety of the dollar, yen and gold.
MKTS/GLOB
Analysts said the news could hurt Trump's campaigning
ability and jack up market volatility at a time when investors
were already skittish after a chaotic presidential debate
heightened fears of a messy transfer of power. "It's one more insecurity heading into a tight, contentious
election," said Oliver Pursche, president of Bronson Meadows
Capital Management in Fairfield, Connecticut.
"And given that Trump does not adhere to conventional norms
and rules, who knows what he'll do in terms of postponing the
elections."
A senior White House official said the president is "not
incapacitated" and will work from his residence. After Trump said he had the coronavirus, online gambling
site Betfair suspended betting on the outcome of the election.
Betfair's odds had previously shown Democratic challenger Joe
Biden's probability of winning at 60% on Wednesday. At 9:37 a.m. ET, the Dow Jones Industrial Average .DJI was
down 0.99%, the S&P 500 .SPX was down 1.25% and the Nasdaq
Composite .IXIC was down 1.68%.
The risk-off mood sparked a broad-based decline, with banks
.SPXBK tracking Treasury yields lower and tech mega-caps,
which generally tend to outperform at a time of economic
uncertainty, slumping between 1.6% and 2.3%. US/
Tesla Inc TSLA.O slipped 4.1% even as it reported record
vehicle deliveries in the third quarter. Trading on Wall Street turned choppy last month, with the
S&P 500 snapping a five-month gaining streak, as economic data
indicated a long road to pre-pandemic levels and Congress
deliberated over the next round of fiscal stimulus. With a bipartisan deal eluding House Speaker Nancy Pelosi
and the White House, the U.S. House of Representatives on
Thursday approved a $2.2 trillion Democratic plan on fiscal aid,
but objections from top Republicans are likely to doom the plan
in the Senate. Airlines including United Airlines Holding Inc UAL.O ,
Delta Air Lines Inc DAL.N , JetBlue Airways Corp JBLU.O and
American Airlines Group Inc AAL.O fell more than 2%.
Meanwhile, data showed U.S. job growth slowed more than
expected in September as the recovery from the COVID-19 slump
shifts into lower gear, although the unemployment rate fell to
7.9% from 8.4% in August. "My initial reaction was, 'ouch!' I don't think it's going
to do anything for the market; it's not positive enough," said
Patrick Leary, chief market strategist at Incapital in
Minneapolis.
The CBOE volatility index .VIX , known as Wall Street's
fear gauge, shot up to a one-week high.
Declining issues outnumbered advancers 9.77-to-1 on the NYSE
and 8.50-to-1 on the Nasdaq.
The S&P index recorded no new 52-week high and one new low,
while the Nasdaq recorded three new highs and 21 new lows.