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December 31 & 2015 Market Close: GovCon Index Ends Year on Down Note, Short of 10% YTD Gain

GovConIndexDOWNThe GovCon Index ended 2015 on a negative note Thursday with a decline of 1.124 percent to 76.995 and fell short of a year-to-date gain of at least 10 percent.

The Index has recorded a full-year gain of 9.01 percent driven by a surge in volume for defense stocks after the November 13 Paris attacks, which helped spur the Index’s fourth quarter exit out of negative territory on a year-to-date basis then.

A slew of strong earnings reports from many Index stocks also contributed to the fourth quarter turnaround after a third quarter that saw entries in and out of the correction zone, or 10 percent down from the most recent high.

Orbital ATK (NYSE: OA) was the Index’s biggest gainer in its first year of existence after the merger of Orbital Sciences with ATK.

Leidos Holdings (NYSE: LDOS) and Northrop Grumman (NYSE: NOC) were respectively second and third for the year after both companies posted third quarter earnings above analyst forecasts and won multi-billion dollar government contracts.

Leidos and its partners Accenture (NYSE: ACN) and Cerner (Nasdaq: Cern) were chosen for the Defense Department’s electronic health record implementation contract, while Northrop was selected to build the Air Force’s Long Range Strike Bomber.

Of the three major U.S. indices, only the NASDAQ composite index ended the year in positive territory as both Dow and S&P 500 recorded their first negative years since 2008.

Declines in commodity prices drove U.S. stocks into the red for 2016 with crude oil the major focus for traders in the second half of 2015.

Both major oil price benchmarks declined sharply in 2015 crude futures in New York down 39.1 percent for the year and brent crude in London at a 43.88-percent decline.

Investors will also look ahead from the next year’s start to gauge further impacts from the Federal Reserve’s mid-December move to raise interest rates for the first time in nearly a decade.

Top GovCon Index Gainers for Dec. 31

Symbol Company $ Current Price Net Change % Change
I Intelsat 4.16 +0.05 +1.22%
EGL Engility Holdings 32.48 +0.32 +1.00%
CSRA * CSRA 30.00 +0.25 +0.84%
BAH Booz Allen Hamilton 30.85 +0.03 +0.10%

* Also listed in the S&P 500 index

Market Summary for Dec. 31

Advancing Issues 4
Declining Issues 25
Unchanged Issues 1
Index Value Net Change % Change
GovCon Index 76.995 -0.875 -1.124%
S&P 500 2, 043.94 -19.42 -0.94%
Dow Jones Industrial Average 17, 541.74 -178.84 -1.02%
NASDAQ 5, 007.41 -58.43 -1.15%

Top GovCon Index Gainers for 2015

Symbol Company $ Current Price % Change
OA Orbital ATK 89.34 +64.93%
LDOS Leidos Holdings 56.26 +29.27%
NOC Northrop Grumman 188.81 +28.10%
HNT Health Net 68.46 +27.89%
OA Orbital ATK 86.90 +21.00%

Market Summary for 2015
(top table excludes CSRA, BAE Systems and Serco Group)

Advancing Issues 19
Declining Issues 8
Unchanged Issues 0
Index Value % Change
GovCon Index 76.995  +9.01%
S&P 500 2, 043.94 -0.73%
Dow Jones Industrial Average 17, 720.98 -2.23%
NASDAQ 5, 107.94 +5.73%

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