Executive Mosaic’s GovCon Index closed at an all-time record high Monday with large aerospace-and-defense primes the main contributors to gains after President Donald Trump unveiled his proposal to raise military spending 9 percent for the next federal fiscal year.
U.S. stocks also posted small gains as the benchmark S&P 500 composite index also hit record closing and intraday highs ahead of Trump’s address to a joint session of Congress Tuesday night with tax and regulatory policy key items of interest for Wall Street.
GovCon Index advancers outnumbered decliners by a 5-to-1 ratio as 10 of its 11 S&P 500 components registered gains with co-listed Lockheed Martin (NYSE: LMT) the GCi’s top net performer overall.
GCI-S&P companies Lockheed, Northrop Grumman (NYSE: NOC), L3 Technologies (NYSE: LLL) and Boeing (NYSE: BA) all rose by at least $2.00 each after Trump’s comments to state governors at the White House on his plan for a “a historic increase in defense spending.
Trump added he would disclose further details on his military budget and infrastructure plans during his address to Congress Tuesday, according to a Reuters report from the White House.
Large primes and other contractors with strong defense footprints have paced the GovCon Index to an 18-percent gain and successive record closes since Trump’s Nov. 8 election victory on investor anticipation of a military spending boost.
Six other GCI stocks posted gains of more than $1.00 Monday: Rockwell Collins (NYSE: COL), Orbital ATK (NYSE: OA), AECOM (NYSE: ACM), Raytheon (NYSE: RTN), Huntington Ingalls Industries (NYSE: HII) and Navistar International (NYSE: NAV).
Ten GovCon Index components hit 52-week highs during the session: Boeing, Huntington Ingalls, Lockheed, Orbital ATK, Raytheon, Rockwell Collins, General Dynamics (NYSE: GD), Harris Corp. (NYSE: HRS), Leidos Holdings (NYSE: LDOS), Science Applications International Corp. (NYSE: SAIC).
Services contractors ICF (Nasdaq: ICFI) and CGI Group (NYSE: GIB) closed as the GCI’s two largest net decliners on Trump’s proposal to finance the defense spending increase with cuts to civilian agencies such as the State Department and Environmental Protection Agency, both of which the companies hold various contracts with.
Energy stocks climbed 1 percent to lead five major S&P sectors lower with telecommunications the largest drag among the remaining six at a 1-percent decline.
Investors also weighed January durable good order data that showed a 1.8-percent increase for the month versus the 1.7-percent growth forecast but pending home sales tumbled 2.8 percent, CNBC reported.
Market Summary
| Index | Value | Net Change | % Change |
|---|---|---|---|
| GovCon Index | 94.184 | +0.846 | +0.906% |
| S&P 500 | 2,369.73 | +2.39 | +0.10% |
| Dow Jones Industrial Average | 20,837.44 | +15.68 | +0.08% |
| NASDAQ | 5,861.90 | +9.80 | +0.28% |
| Advancing GovCon Index Issues | 24 |
| Declining GovCon Index Issues | 6 |
| Unchanged GovCon Index Issues | 0 |
Top GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –´ | % Change |
|---|---|---|---|---|
| LMT | Lockheed Martin * | 269.36 | +5.18 | +1.96% |
| NOC | Northrop Grumman * | 248.60 | +3.55 | +1.45% |
| LLL | L3 Technologies * | 168.90 | +2.51 | +1.51% |
| BA | Boeing * | 179.43 | +1.99 | +1.12% |
| OA | Orbital ATK | 93.51 | +1.66 | +1.81% |
Top GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –´ |
|---|---|---|---|---|
| VEC | Vectrus | 24.37 | +1.00 | +4.28% |
| NAV | Navistar International | 27.80 | +1.12 | +4.20% |
| ACM | AECOM | 37.15 | +1.38 | +3.86% |
| EGL | Engility Holdings | 31.99 | +0.99 | +3.19% |
| BAH | Booz Allen Hamilton | 36.68 | +0.76 | +2.12% |
Lowest GovCon Index Net Performers
| Symbol | Company | $ Current Price | Net Change –¾ | % Change |
|---|---|---|---|---|
| GIB | CGI Group | 46.76 | -0.32 | -0.68% |
| MANT | ManTech International | 36.73 | -0.19 | -0.51% |
| HON | Honeywell International * | 124.89 | -0.14 | -0.11% |
| ICFI | ICF | 51.35 | -0.10 | -0.19% |
| LDOS | Leidos Holdings | 54.04 | -0.04 | -0.07% |
Lowest GovCon Index Percentage Performers
| Symbol | Company | $ Current Price | Net Change | % Change –¾ |
|---|---|---|---|---|
| GIB | CGI Group | 46.76 | -0.32 | -0.68% |
| MANT | ManTech International | 36.73 | -0.19 | -0.51% |
| CAE | CAE | 15.19 | -0.03 | -0.20% |
| ICFI | ICF | 51.35 | -0.10 | -0.19% |
| HON | Honeywell International * | 124.89 | -0.14 | -0.11% |
