Executive Mosaic’s GovCon Index fell 1 percent Monday on a steep by Lockheed Martin‘s (NYSE: LMT) stock at 2 percent as other large defense primes also tumbled after President-elect Donald Trump criticized the F-35 program’s costs in a Twitter post before markets opened.
The GovCon Index traded down 2 percent shortly before 12 p.m. Eastern time with Lockheed lower by at least 5 percent before both the GCI and company pared their losses during the afternoon session along with other prime contractors.
Monday’s decline brings the GCI below 90 points after four closes out of the last five sessions above that benchmark to represent the Index’s first entry into 90-point territory in its two years of existence.
GovCon Index laggards outnumbered gainers by a 5-to-1 ratio Monday with Honeywell International (NYSE: HON), Boeing (NYSE: BA) and Textron (NYSE: TXT) the lone two advancers of the GCI’s 11 S&P 500-listed stocks.
Trader reaction to Trump’s tweet paused a post-election rally by defense contractors and the overall GCI as investors anticipate boosts to military spending and in particular his campaign pledges to grow the U.S. Navy‘s ship fleet size and more fighter jets for the U.S. Air Force among others.
The F-35 program represents one-fifth of Lockheed’s overall revenue.
Lockheed took a $5.7 billion hit to its market capitalization and closed as the GovCon Index’s largest net decliner with F-35 center fuselage maker Northrop Grumman (NYSE: NOC) the second-biggest laggard on the Index.
Volume in Lockheed’s stock totaled 6.76 million shares traded to exceed the three-month average by four times and Northrop at 2.81 million shares, or two-fold.
Defense and government services contractors Science Applications International Corp. (NYSE: SAIC) and CACI International (NYSE: CACI) respectively finished third and fourth for GCI net laggards followed by military shipbuilder Huntington Ingalls Industries (NYSE: HII).
Services-oriented GCI companies closed in the GCI’s group of its lowest five percentage performers: Engility Corp. (NYSE: EGL), SAIC, ManTech International (Nasdaq: MANT), Leidos Holdings (NYSE: LDOS) and CSRA (NYSE: CSRA).
Non-GCI company United Technologies Corp. (NYSE: UTX) closed up a half-percent — or $0.61 – as UTC is the parent of the plane’s engine maker Pratt & Whitney.
Global technology services provider CGI Group (NYSE: GIB) ended as the GCI’s top overall gainer on net and percentage movement, followed by Honeywell and Boeing.
U.S. stocks ended mostly lower with consumer discretionary the top performing S&P 500 sector out of five gainers as telecommunications shares were the biggest drag among the remaining six as trader attention turns to the Federal Reserve‘s policy meeting Tuesday and Wednesday.
Market expectations of an interest rate hike this week exceed 95 percent, CNBC reported.
Market Summary
| Index | Value | Net Change | % Change |
|---|---|---|---|
| GovCon Index | 89.113 | -1.293 | -1.430% |
| S&P 500 | 2, 256.96 | -2.57 | -0.11% |
| Dow Jones Industrial Average | 19, 796.43 | +39.58 | +0.11% |
| NASDAQ | 5, 412.54 | -31.96 | -0.59% |
| Advancing GovCon Index Issues | 5 |
| Declining GovCon Index Issues | 25 |
| Unchanged GovCon Index Issues | 0 |
Lowest GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –¾ | % Change |
|---|---|---|---|---|
| LMT | Lockheed Martin * | 253.11 | -6.42 | -2.47% |
| NOC | Northrop Grumman * | 232.07 | -6.36 | -2.67% |
| SAIC | SAIC | 85.08 | -3.57 | -4.03% |
| CACI | CACI International | 128.35 | -3.50 | -2.65% |
| HII | Huntington Ingalls Industries | 178.20 | -3.30 | -1.82% |
Lowest GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –¾ |
|---|---|---|---|---|
| EGL | Engility Holdings | 36.00 | -2.90 | -7.46% |
| SAIC | SAIC | 85.08 | -3.57 | -4.03% |
| LDOS | Leidos Holdings | 50.30 | -1.95 | -3.73% |
| MANT | ManTech International | 43.80 | -1.69 | -3.72% |
| CSRA | CSRA * | 31.65 | -1.05 | -3.21% |
Top GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –´ | % Change |
|---|---|---|---|---|
| GIB | CGI Group | 48.35 | +1.31 | +2.78% |
| HON | Honeywell International * | 117.41 | +1.18 | +1.02% |
| BA | Boeing * | 157.16 | +0.67 | +0.43% |
| MCK | McKesson Corp. * | 146.49 | +0.24 | +0.16% |
| TXT | Textron * | 48.40 | +0.01 | +0.02% |
Top GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –´ |
|---|---|---|---|---|
| GIB | CGI Group | 48.35 | +1.31 | +2.78% |
| HON | Honeywell International * | 117.41 | +1.18 | +1.02% |
| BA | Boeing * | 157.16 | +0.67 | +0.43% |
| MCK | McKesson Corp. * | 146.49 | +0.24 | +0.16% |
| TXT | Textron * | 48.40 | +0.01 | +0.02% |
