Executive Mosaic’s GovCon Index ended positive after the Thanksgiving break, rising 0.5% to $5,203.60. While it was a modest 0.18% week-on-week loss from Nov. 25-29, it was the third-straight monthly loss for the index tracking the stock performances of 30 major government contractors. Its last winning month was August.
Wall Street added month-end gains, resulting in the best monthly performances in 2024 for the Dow Jones Industrial Average (+7.54%) and S&P 500 (+5.73%). The tech-heavy Nasdaq Composite (+6.21%) had a stellar month, boosted by the rising artificial intelligence, or AI tide.
Outstanding Performer
Palantir Technologies (NYSE: PLTR) closed at $67.08 on month-end for a 61.4% monthly gain. GCI’s top performer is up +290.68% versus +179.23% of AI king NVIDIA (Nasdaq: NVDA). The AI stock started trading on the Nasdaq exchange on Tuesday, Nov. 26. It also joined the S&P 500 Index in September.
Market analysts say Palantir’s Artificial Intelligence Platform is a game-changer and major growth driver. The US government is also the biggest client of the data analytics firm and would benefit from higher federal spending in the artificial intelligence space.
Boeing (NYSE: BA) was among the week’s surprise gainers (+8.39%) and second to Palantir (+9.32%). BAE Systems, the worst performer, declined 6.76% in five days and tanked 4.22% Friday following a downgrade. Bank of America (NYSE: BAC) analysts said potential US defense spending cuts could affect the British defense and security company.
Heaviest Inflow
According to EPFR Global data, investments in US stocks reached $141 billion in November. It was the heaviest inflow on record in four weeks. On a year-to-date basis, the Nasdaq Composite is up +28.02%, while the broad S&P 500 and blue-chip Dow Jones Industrial Average enter the last trading month with +26.47% and +19.16%, respectively.
The GovCon Index recorded its best week and worst weekly performance during the month. Because of possible policy changes in the government contracting industry under the incoming administration, defense stocks experienced the worst beating. Still, the aggregate index of key government contracting companies is up +11.46% year-to-date.
