Whenever I place a static mesh the first material (element 0) is always the engine’s BasicShapeMaterial. This happens for both the starter content and my own meshes. Any other materials above element 0 are applied correctly.
I was able to find this in our bug report system and can confirm that it has been fixed internally. Looks like the fix just missed the preview branching, but it will be in a future release of the engine. Let me know if you experience anything else unexpected in 4.7 preview 5.