Executive Mosaic’s GovCon Index posted three losses out of four trading days during the week, resulting in a 4.08% week-on-week drop. It was the worst weekly loss since its launch in December 2023. The index tracking the stock performances of 30 major government contractors declined 1.71% Friday to close at $5,312.73.
Wall Street suffered a sharp selloff due to fears of a weakening labor market and its impact on the rate cut decision by the U.S. Federal Reserve in September. The Dow Jones Industrial Average lost 2.9% for the week, while the Nasdaq Composite (-5.8%) and S&P 500 (-4.2%) sunk to their worst weekly performance since January 2022 and March 2023, respectively.
Despite the steep weekly loss, the GovCon Index remains up 13.8% thus far in 2024, compared to +13.4%, +11.2%, and +7% for the S&P 500, Dow Jones, and the Nasdaq Composite. Palantir Technologies (NYSE: PLTR) was the only gainer Friday among 30 GCI constituents, edging 0.56% higher to $30.33.
Palantir Technologies is also the top performing GCI stock, with its +76.65% year-to-date gain. Starting Sept. 23, the AI stock will officially join the S&P 500 following the index’s quarterly reshuffle.
New York Fed President John Williams and Fed Governor Christopher Waller calmed investors’ fears. Both Fed officials support and expect a rate cut this month, but the size is still unknown.
