Markets face a double whammy of bad news after the president's health upended an election heading into its final stretch and the September jobs report proved disappointing.

Transcript

DAVID GREENE, HOST:

Investors are reacting to the uncertainty over President Trump and the first lady's coronavirus test results. The stock market opened lower this morning, and overseas markets also fell after the president tweeted the news overnight. All this comes as Congress has failed to pass another round of coronavirus relief aid. And a new jobs report out this morning shows a recovery that may be losing steam. Let's turn to NPR's chief economics correspondent, Scott Horsley. Good morning, Scott.

SCOTT HORSLEY, BYLINE: Good morning, David.

GREENE: Let's start with the financial markets. How have they been reacting to the president's positive test result?

HORSLEY: Markets are down but not dramatically so. The Dow dropped about 300 points in the first few minutes of trading this morning. That's just over 1%. European markets were also lower. A lot of the Asian markets were closed for a holiday today, but the Nikkei index in Japan dropped less than 1%. We've seen bigger moves in recent days as investors try to game out prospects for another round of coronavirus relief here in Washington. So, you know, certainly this is another wild card, one more wild card, as we approach the November election. And uncertainty can add to market volatility, but the reaction in the market so far has been fairly muted.

GREENE: I mean, we're getting pretty close to that November Election Day. And we have a new jobs report out this morning from the government, and, I mean, this is the last one before the election, right?

HORSLEY: That's right. And it's not a great one. The U.S. is still adding jobs but at a much slower pace. Employers added just 661,000 jobs in September. That's less than half the number of jobs they added the month before and now we've seen three straight months of declining job growth. And we've only recovered about half of the 22 million jobs that were lost back in March and April. Now, there was an encouraging sign. The unemployment rate fell in September to 7.9%. That sounds pretty good. Unfortunately, behind that headline, the drop was mostly because people got discouraged and dropped out of the labor market. Some businesses are still hiring. Restaurants and retailers continued to add jobs in September; so did professional services. But we saw pretty big job cuts in education by state and local governments, which is an ominous sign. Also some of those temporary census workers who were hired in August were let go in September as the head count nears its completion.

GREENE: All right. So we talk markets. We talk unemployment and jobs numbers. What if we zoom out and just talk about the broader economy? How is it faring, and how has it gotten through this pandemic if we were to take a look right now?

HORSLEY: Some parts the economy are doing OK. Homebuilding, for example, has been booming thanks to high demand for houses and super low interest rates. But overall, we are seeing an economic rebound that is losing some of its bounce. Personal income fell in August largely because of a big drop in unemployment benefits after that $600 a week that Congress had authorized early in the pandemic expired at the end of July. Spending on goods has mostly - has basically recovered to its pre-pandemic levels. But spending on services has not. And, you know, there's a concern that the relief payments that have been cushioning the fallout have been - have largely expired now and there's no replacement in sight. What's more, there is a fear of a resurgence of the virus itself as colder weather comes. And news from the White House about the president's diagnosis is just going to add to that.

GREENE: NPR chief economics correspondent Scott Horsley. Scott, thanks so much.

HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.

Tags: Series: The Coronavirus Crisis