Executive Mosaic’s GovCon Index inched lower to $4,475.50 (-0.17%), a new low for the index representing the government contracting sector. Trade tensions caused the Dow Jones Industrial Average (-1.55%), S&P 500 (-1.22%) and Nasdaq Composite (-0.35%) to slump for the second straight session.
All 11 S&P 500 primary sectors and 75% of NYSE stocks closed in the red as U.S. tariffs on Canada, Mexico and China went into effect on March 4. The financial services sector declined -3.54%. After predicting increasing prices for American consumers due to tariffs, electronics retailer Best Buy (NYSE: BBY) plunged by -13.3%.
Modest drop
The GovCon Index remained in negative territory after posting a modest drop. A dozen GCI stocks, bannered by CACI (NYSE: CACI) and Science Applications International Corporation (Nasdaq: SAIC), tempered Tuesday’s loss. Carlyle Group (Nasdaq: CG) and Boeing (NYSE: BA), the worst Dow Jones performer, led 18 underperformers.
CACI appears safe from possible policy changes in government contracting. In Q2 fiscal 2025, the professional services and IT company secured $1.2 billion in contract awards, including a sole-source contract worth over $131 million to deliver advanced data visualization technology for the Department of Defense and the Intelligence Community.
Carlyle CEO Harvey Schwartz warns that a trade war could result in sustained inflation. However, he remains optimistic about the U.S. economy. The private equity firm plans to sell $4 billion to $5 billion in assets in 2025 through initial public offerings or the sale of existing investments.
Boeing continues to show signs of recovery, but increased tariffs could stall it. The aircraft manufacturer is one of the largest U.S. capital goods exporters. Higher supplier costs could impact profit margins and airlines might shift orders to their rival, Airbus.
Also, on Tuesday, the U.S. Navy awarded Sikorsky Aircraft, a Lockheed Martin (NYSE: LMT) company, a $99.9 million modification to a previously awarded cost-plus-fixed-fee, firm-fixed-price, indefinite-delivery/indefinite-quantity contract relating to the support sustainment efforts for the H-53 helicopter for the Marine Corps, Navy, and Foreign Military Sales customers.
Retaliatory tariffs
Canada and China announced retaliatory tariffs on the blanket tariffs imposed by the U.S. on them. Some market analysts say the U.S. dollar typically strengthens with tariffs relative to other currencies but is alarming when it weakens.
Market Summary
| Index | Price | Net Change | % Change |
|---|---|---|---|
| GovCon Index Daily Average | 4,475.50 | -7.54 | -0.17% |
| Dow Jones Industrial Average | 42,520.99 | -670.25 | -1.55% |
| NASDAQ | 18,285.16 | -65.03 | -0.35% |
Top 5 GovCon Index Daily Percentage Performers
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| CACI | 353.02 | 23.48 | 7.13% |
| SAIC | 100.9 | 5.13 | 5.36% |
| MMS | 67.41 | 3.07 | 4.77% |
| ICFI | 80.86 | 3.18 | 4.09% |
| PSN | 57.51 | 2.16 | 3.90% |
Top 5 GovCon Index Daily Net Performers
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| CACI | 353.02 | 23.48 | 7.13% |
| SAIC | 100.9 | 5.13 | 5.36% |
| ICFI | 80.86 | 3.18 | 4.09% |
| MMS | 67.41 | 3.07 | 4.77% |
| BAH | 105.79 | 3.07 | 2.99% |
Top 5 GovCon Index Daily Percentage Decliners
| Symbol | Price | Net Change | % Change |
|---|---|---|---|
| CG | 45.03 | -3.24 | -6.71% |
| BA | 158.9 | -11.16 | -6.56% |
| TXT | 70.19 | -3.83 | -5.17% |
| RTX | 128.7 | -5.13 | -3.83% |
| FLR | 35.93 | -0.99 | -2.68% |
