The current market turmoil in stocks and the record lows on longer-term Treasury yields has created a very difficult environment for investors. It’s also creating an environment in which most good news is ignored because the market believes that things will get worse before they can get better. That is why a solid jobs report was being ignored early on Friday.

The Bureau of Labor Statistics released its Employment Situation report, showing that unemployment ticked back down to 3.5% in February after having been 3.6% in January. Dow Jones had a consensus estimate of 3.5% and Econoday had a consensus estimate of 3.6%.

Similar to what was seen with the ADP report earlier this week, the payrolls data were stronger than expected. Nonfarm payrolls rose by 273,000 and private sector payrolls rose by 228,000 in February. Econoday’s consensus estimates were 177,000 and 155,000 for the month, respectively. Dow Jones was predicting a 175,000 gain in nonfarm payrolls.

January’s payroll gains were revised slightly higher as well. The preliminary report of 225,000 nonfarm payrolls was revised to 273,000, and the private sector’s preliminary payrolls gains of 206,000 was revised to 222,000.

All in all, these are strong jobs numbers, and they are stronger than what you might have expected based on the market panic around stocks and bonds. That said, what is happening is that good news today is being discounted with the assumption that things are going to be much worse in a week, a month and maybe for much longer.

The labor force participation rate was flat at 63.5% in February. Average hourly earnings were also flat at a 0.3% monthly gain and with a 3% annual gain, and the average workweek was up to 34.4 hours from January’s 34.3 hours.

One issue that is keeping up the numbers is that employers remain concerned about letting workers go during a slowdown. If the real impact is far less than the public is worried about, then letting a worker go might mean they end up working for a competitor or that filling their position becomes rather challenging. Last week’s jobless claims of just 216,000 would support that observation, and that means the labor market remains tight.

After about 15 minutes of trading, the Dow Jones industrials were down 758 points at 25,363.25 and the S&P 500 was down almost 88 points at 2,936.17. The yield on the 10-year Treasury note was 0.69% and the yield on the 30-year Treasury Bond was just 1.26%.

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