Executive Mosaic’s GovCon Index ended slightly higher on Friday at $4,830.86 (+0.05%), although it still lost -0.73% for the week. The index, which tracks the stock performances of 30 major government contractors, is off to a rough start in 2025 and is down -0.14% year-to-date.
Wall Street reopened after the Day of Mourning, but the major stock indexes tumbled on better-than-expected job growth in December. After Friday’s sharp selloff, the blue-chip Dow Jones Industrial Average and broader S&P 500 lost 1.9% week-on-week, while the Nasdaq Composite registered a 2.3% weekly loss. Market analysts said a resilient labor market dim the chances of a rate cut this month.
GovCon Index Slump Continues
The GovCon Index’s slump from mid-November has carried over into 2025. Thus far in January, the government contracting sector index recorded three daily gains in six trading days. Palantir Technologies (Nasdaq: PLTR), last year’s top performer, is struggling too.
Palantir Technologies is down -11.07% year-to-date because of the underweight rating by Morgan Stanley (NYSE: MS) early this month. The investment bank cited unsustainable valuation levels caused by the artificial intelligence euphoria and trading momentum. At $67.26 per share, the AI stock’s trailing one-year price return is +310.37%.
Kratos Defense & Security Solutions (Nasdaq: KTOS), the top performer at the start of the year, is up +11.33% year-to-date. On Jan. 6, 2025, the technology and defense firm signed a five-year, up to $1.5 billion contract with the Department of Defense. The Multi-Service Advanced Capability Hypersonic Test Bed or MACH-TB 2.0 contract is the largest in the company’s history.
New Business Development
On January 8, 2025, Accenture (NYSE: ACN) announced acquiring the digital twin technology platform for banks of Percipient, a Singapore-based financial technology company. The platform will enhance the global consulting company’s core banking modernization capabilities. Banks can unlock new growth opportunities, launch new products faster, and deepen customer engagement through cloud, data, and AI.
