Executive Mosaic’s GovCon Index declined two straight days, finishing 0.49% lower at $5,176.36 on Friday. The index, which tracks the stocks of 30 major government contractors, registered a 2.45% loss in the first week of December.
However, it was a winning week for the major U.S. equities benchmarks. The Dow Jones Industrial Average reached its highest close of 45,014.04 midweek and advanced 0.6% overall. Meanwhile, the Nasdaq Composite (+3.3%) and S&P 500 Index (+1%) posted multiple record highs during the week.
The GovCon Index remains positive year-to-date, but the gain is down to 8.74% from a high of 20.82% on Nov. 8. On Wall Street, the Nasdaq Composite, S&P 500 and Dow Jones are up 32.3%, 27.7% and 18.4%, respectively.
Brightest star
Palantir Technologies (Nasdaq: PLTR) remains the brightest star as the GovCon Index struggles. The artificial intelligence stock rose 6.22% before the weekend and gained 13.8% in five days. At $76.34 per share, the year-to-date gain is 344.61%. AI king NVIDIA is a far second with +187.71%.
Many defense stocks retook a hit, notwithstanding the midweek rebound. AeroVironment (Nasdaq: AVAV), the worst performer, tanked 15.88% Thursday and lost 16.03% during the week. The manufacturer of unmanned aerial systems saw its Q2 fiscal 2025 net income drop 136.5% year-over-year to $7.54 million due to lower drone sales.
On Tuesday, Palantir Technologies secured a FedRAMP High Authorization from the US government. The data analytics firm also announced several growth drivers, including a co-creation partnership with Booz Allen Hamilton (NYSE: BAH) to accelerate defense mission innovation while strengthening national security.
Palantir will collaborate with defense technology firm Anduril to enhance AI adoption for national security, particularly data readiness and data processing at scale. The partners also plan to expand the consortium to other industry partners.
Resilient labor market
The latest Bureau of Labor Statistics data shows a resilient labor market. While the November unemployment rate rose slightly to 4.2% from 4.1%, 227,000 new jobs were added to the US economy versus 36,000 in October. Still, the jobless rate is below the 5.7% long-term average.
