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US STOCKS-Wall St set to slide after Trump's positive COVID-19 test

(For a live blog on the U.S. stock market, click or type LIVE/ in a news window.)

* 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

* Futures off: Dow 1.41%, S&P 1.42%, Nasdaq 2.01% (Adds comments, updates price)

Oct 2 (Reuters) - Wall Street’s main indexes were set to tumble on Friday after President Donald Trump tested positive for COVID-19 weeks before the election, with Washington’s failure to reach a new fiscal stimulus deal also hurting sentiment.

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.

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.

“There are more questions than answers right now (and) stock markets tend to sell first and ask questions later,” said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

“Until there’s more concrete news (around) how he’s feeling, it’s probably going to be tough for the market to bounce back significantly.”

A senior White House official said the president is “not incapacitated” and will work from his residence.

At 8:36 a.m. ET, Dow e-minis were down 390 points, or 1.41%, S&P 500 e-minis were down 47.75 points, or 1.42%, and Nasdaq 100 e-minis were down 233 points, or 2.01%.

The risk-off mood sparked broad-based premarket declines, with banks tracking Treasury yields lower and tech mega-caps, which generally tend to outperform at a time of economic uncertainty, slumping between 1.9% and 2.9%.

Tesla Inc slipped 4.3% even as it reported record vehicle deliveries in the third quarter.

Trading in U.S. stocks 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, Delta Air Lines Inc, JetBlue Airways Corp and American Airlines Group Inc fell between 3.1% and 4.2%.

Meanwhile, data on Friday showed U.S. job growth slowed more than expected in September as the recovery from the COVID-19 slump shifts into lower gear. The Labor Department’s closely watched report was the last before the Nov. 3 election.

After Trump said he had 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.

The CBOE volatility index, known as Wall Street’s fear gauge, shot up to a one-week high.

Reporting by Sagarika Jaisinghani and Devik Jain in Bengaluru; Editing by Shounak Dasgupta and Arun Koyyur

Nuestros Estándares: Los principios Thomson Reuters.

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