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December 29 Market Close: GovCon Index Advances, US Stocks Turn Red After Russia Sanctions

Executive Mosaic’s GovCon Index moved higher Thursday on broad gains among defense primes and services contractors as U.S. stocks closed slightly lower in a mostly quiet penultimate trading session for 2016.

Investors continued their post-election focus on defense and other GovCon stocks, while the S&P 500 composite index turned slightly negative as markets reacted to news of U.S. sanctions against Russia for the latter’s alleged activity in the Nov. 8 election.

Both the GovCon Index and S&P 500 are on course to exceed a 10-percent gain each over 12 months on that post-election rally from Nov. 8 onward that has seen traders bet on new stimulus, tax cuts and deregulation under a Donald Trump administration.

GovCon Index gainers outnumbered laggards by a 2-to-1 ratio Thursday and nine of its 11 S&P 500 components advanced with co-listed Raytheon (NYSE: RTN) as the GCI’s overall top net advancer.

Raytheon lifted on news of close to $1.11 billion in contract awards for missiles along with hardware and related services for missile defense systems.

The company announced Thursday a $600 million contract to update a unnamed country’s Patriot missile defense system to the latest configuration.

In addition, the Defense Department said Raytheon was awarded a $303.7 million contract for 214 Tomahawk missiles for the U.S. Navy and the U.K, as well as a separate $208 million job to sell Stinger FIM-92H missiles and related equipment to Qatar, India and Italy.

CACI International (NYSE: CACI), L-3 Communications (NYSE: LLL), Science Applications International Corp. (NYSE: SAIC) and Lockheed Martin (NYSE: LMT) rounded out the GCI top five net gainers with all up by at least $1.00.

SAIC is on pace to end 2016 as the GovCon Index’s second-largest percentage gainer by at least 80 percent as the McLean, Va.-based government services contractor exceeded Wall Street’s earnings expectations in all three quarterly financial reports the company posted this year.

SAIC operates its fiscal calendar on a February-January basis.

Navistar International (NYSE: NAV) is set to close as the GCI’s top percentage advancer for the year at more than 200 percent as investors have welcomed Volkswagen‘s investment in the heavy truck manufacturer announced in September.

Notable Thursday laggers in the GCI included Cubic Corp. (NYSE: CUB) and AECOM (NYSE: ACM), the latter of which ended the session as the GCI’s second-lowest percentage mover and has traded down 9.39 percent since Dec. 9.

Up until that date, AECOM’s stock registered a post-election rally of 46.58 percent up until Dec. 9 as investors also looked at Trump’s campaign pledges to increase infrastructure spending.

Boeing (NYSE: BA), Navistar and KBR (NYSE: KBR) also closed among the GCI’s five lowest net performers.

Financial stocks led Thursday’s declines to pause that sector’s post-election rally as investors lean toward higher rates and looser regulations.

Market Summary

Index Value Net Change % Change
GovCon Index 88.285 +0.285 +0.324%
S&P 500  2, 249.26 -0.66 -0.03%
Dow Jones Industrial Average 19, 819.78 -13.90 -0.07%
NASDAQ 5, 432.09 -6.47 -0.12%
Advancing GovCon Index Issues 20
Declining GovCon Index Issues 10
Unchanged GovCon Index Issues 0

Top GovCon Index Net Performers

Symbol Company $ Current Price Net Change ▴ % Change
RTN Raytheon * 143.39 +1.57 +1.11%
CACI CACI International 125.35 +1.45 +1.17%
LLL L-3 Communications * 152.97 +1.26 +0.83%
SAIC SAIC 85.39 +1.11 +1.32%
LMT Lockheed Martin * 250.59 +1.01 +0.40%

Top GovCon Index Percentage Performers

Symbol Company $ Current Price Net Change % Change ▴
SAIC SAIC 85.39 +1.11 +1.32%
CACI CACI International 125.35 +1.45 +1.17%
RTN Raytheon * 143.39 +1.57 +1.11%
CSRA CSRA * 31.94 +0.35 +1.11%
LDOS Leidos Holdings 51.39 +0.49 +0.96%

Lowest GovCon Index Net Performers

Symbol Company $ Current Price Net Change ▾ % Change
CUB Cubic Corp. 47.75 -0.65 -1.34%
ACM AECOM 36.37 -0.54 -1.46%
BA Boeing * 155.69 -0.41 -0.26%
NAV Navistar International 31.79 -0.38 -1.18%
KBR KBR 16.86 -0.29 -1.69%

Lowest GovCon Index Percentage Performers

Symbol Company $ Current Price Net Change % Change ▾
KBR KBR 16.86 -0.29 -1.69%
ACM AECOM 36.37 -0.54 -1.46%
CUB Cubic Corp. 47.75 -0.65 -1.34%
NAV Navistar International 31.79 -0.38 -1.18%
BAESY BAE Systems 29.13 -0.09 -0.31%

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