* Stocks tumble, oil slumps nearly 5% after Trump gets virus

* Payrolls disappoint, Wall Street set for heavy losses

* Russia’s rouble hit hardest among currencies

* Graphic: 2020 asset performance tmsnrt.rs/2yaDPgn

* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh

* Reuters Live Markets blog: (Updates prices, adds context and chart)

LONDON, Oct 2 (Reuters) – Wall Street was set for a heavy tumble on Friday as news that U.S. President Donald Trump and his wife had tested positive for coronavirus just four weeks before U.S. elections sent investors into safer gold, Treasuries and the yen.

Europe’s main bourses were down 0.5%, having clawed back some of their starker morning falls, but oil was down nearly 5% and futures markets were pointing to 1.57 to 2.3% losses for Wall Street’s S&P 500, Dow and Nasdaq .

Trump said on Twitter he and his wife had been tested positive for coronavirus: “We will begin our quarantine and recovery process immediately,” he said in a late night tweet, adding one of his chief aides had contracted the virus too.

The MSCI world equity index, which tracks shares in 49 countries, was down 0.2% but still on course for a 2% rise for the week which will be its best in over a month.

Markets had other gloomy news to digest with weaker than expected monthly U.S. jobs data, but Trump’s exposure could cause a new wave of market volatility if it looks like disrupting in any way the presidential election, which is just 33 days away.

How long the risk-averse moves will last depends on the extent of the infection within the White House, said Francois Savary, chief investment officer at Swiss wealth manager Prime Partners.

“We may have to wait until the end of the weekend for more clarity on the situation,” he said.

“It will weigh on the market today and early next week but will not induce a long-lasting correction if the infection is contained to Trump,” he added.

The United States has never delayed a presidential election, not even during the Civil War or Great Depression, and only moved it for administrative reasons twice – both within the first 60 years of the country’s founding.

When it comes to stock market shocks, the assassination of President John F. Kennedy on Nov. 22, 1963, saw the S&P 500 plunge nearly 3% and Wall Street shut down the New York Stock Exchange at 2:07 p.m. EST. But the losses were confined to a single day and the market recovered within two days.

The news from the White House also triggered a rise in the dollar as well the safe-haven Japanese yen which saw its biggest jump in more than a month, reaching 104.95 at 0553 GMT .

Against a basked of currencies, the dollar index was up 0.1% on the day at 93.807 at 1051 GMT.

The Australian dollar, which serves as a liquid proxy for risk assets, was down 0.5%, though regional tensions meant it was Russia’s rouble that took the biggest hit, dropping 1.5%.

Germany’s benchmark 10-year bond was down around 2 basis points at -0.543%.

Oil fell, with Brent crude down 4.8% to $39.02 a barrel having extended losses as the European session wore on.

Gold rose, up 0.2% at $1,908.63 per ounce, having hit a 10-day high earlier in the session.

BETS ARE OFF

“Depending on how this situation evolves over the weekend, notably if more members of the U.S. government’s senior leadership are diagnosed positive, gold could be set for an extended rally,” said Jeffrey Halley, a senior market analyst at OANDA.

With the situation ahead of the election now thrown into confusion, online gambling site Betfair suspended betting on the outcome of the Nov. 3 vote.

Even before news of Trump’s infection, markets had been more bearish after Washington failed to reach an agreement on a fiscal stimulus package to help the U.S. economy recover from the impact of coronavirus.

The latest round of monthly U.S. unemployment data, the last before the Nov. 3 election date showed slower jobs growth than expected in September as the ongoing COVID-19 slump leaves many at the risk of being permanently unemployed.

Non-farm payrolls increased by 661,000 jobs after advancing 1.489 million in August. Economists polled by Reuters had forecast a 850,000 jump in jobs.

“The recovery continues but at slower rate in part because the government stimulus has diminished significantly,” said Sung Won Sohn, a finance and economics professor at Loyola Marymount University in Los Angeles.

“We are seeing more layoffs and bankruptcies, and until the next government comes in with more support, I would not be surprised to see a renewed decline in employment toward the end of the year.”

Reporting by Elizabeth Howcroft; additional reporting by Rachel Armstrong; Editing by Tomasz Janowski and David Evans

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