August 2 Market Close: GovCon Index Down on Boeing & Services Stock Losses, Harris Jumps 2% on Jana Partners Board Pact

GovConIndexDOWNExecutive Mosaic’s GovCon Index traded downward Tuesday on sharp declines in Boeing (NYSE: BA) and major services-oriented contractors while Harris Corp. (NYSE: HRS) soared 2.71 percent on news of its board of directors membership agreement with activist hedge fund Jana Partners.

The GovCon Index declined 0.316 points to 82.184 and five of the GCI’s 11 S&P 500-listed stocks closed at a gain with the latter index lower as U.S. investors continued to look at extended oil declines and losses by consumer shares.

Harris and Jana, a New York City-based fund run by investor Barry Rosenstein, agreed on two new mutual appointments of independent directors to the 12-member board while the investment group also agreed to both cap its stake in the radio maker at 10 percent and not boost another party’s above 4.9 percent.

Jana owns 1.9 percent of the outstanding shares in Harris, according to subsequent filings with the Securities and Exchange Commission.

Melbourne, Florida-based Harris also issued full-year guidance below analyst expectations as it foresees continued headwinds in the oil and gas sector on commodity declines that have hit the company’s maritime business and lower demand for radios in the Middle East.

Boeing closed down 1.21 percent and Leidos Holdings (NYSE: LDOS) plummeted 4.33 percent while other laggers of at least 2 percent included other government services contractors CACI International (NYSE: CACI), Science Applications International Corp. (NYSE: SAIC), Maximus (NYSE: MMS) and CSRA (NYSE: CSRA).

Large defense primes Lockheed Martin (NYSE: LMT), Northrop Grumman (NYSE: NOC) and Raytheon (NYSE: RTN) helped pare the Index’s losses.

Raytheon hit a 52-week high in intraday trade, as did ManTech International (Nasdaq: MANT).

Crude oil futures in New York settled down 1.37 percent to $39.51 a barrel in the benchmark’s first close below $40 since April.

Top GovCon Index Net Gainers

Symbol Company $ Current Price Net Change ▴ % Change
HRS Harris Corp. * 87.97 2.32 2.71%
LMT Lockheed Martin * 257.00 2.16 0.85%
NOC Northrop Grumman * 218.68 1.99 0.92%
MCK McKesson Corp. * 193.53 1.44 0.75%
RTN Raytheon * 141.20 0.96 0.68%

Top GovCon Index Percentage Gainers

Symbol Company $ Current Price Net Change % Change ▴
HRS Harris Corp. * 87.97 2.32 2.71%
BAESY BAE Systems PLC 31.14 2.10 7.23%
NOC Northrop Grumman * 218.68 1.99 0.92%
LMT Lockheed Martin * 257.00 2.16 0.85%
MCK McKesson Corp. * 193.53 1.44 0.75%

* Also listed in the S&P 500 composite index

Market Summary

Advancing GovCon Index Issues 9
Declining GovCon Index Issues 21
Unchanged GovCon Index Issues 0
Index Value Net Change % Change
GovCon Index 82.184 -0.316 -0.383%
S&P 500 2, 157.03 -13.81 -0.964%
Dow Jones Industrial Average 18, 313.77 -90.74 -0.49%
NASDAQ 5, 137.73 -46.46 -0.90%
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