NEW YORK, March 6, 2015 /PRNewswire/ -- Apple Inc.
(NASD:AAPL) will replace AT&T Inc. (NYSE:T) in the Dow Jones
Industrial Average (DJIA) after the close of trading on
Wednesday, March 18. The change will
be effective with the opening of trading on Thursday, March 19. The index change was prompted
by Visa Inc.'s (NYSE:V) 4:1 stock split which is scheduled to be
effective at the same time. The post-split adjusted lower price of
Visa will reduce the weighting of the Information Technology sector
in the index. Adding Apple to the index will help to partially
offset this reduction. In price weighted indices such as the
DJIA, a large change in price of a high priced stock can have a
material impact on sector representation in the index and this
index change is designed to minimize that impact. The
Telecommunication Services sector will continue to be represented
in the DJIA by Verizon Communications Inc. (NYSE:VZ).
"As the largest corporation in the world and a leader in
technology, Apple is the clear choice for the Dow Jones Industrial
Average, the most recognized stock market measure," says
David M. Blitzer, Managing Director
and Chairman of the Index Committee at S&P Dow Jones
Indices. "The DJIA is price weighted so extremely high stock
prices tend to distort the index while very low stock prices have
little impact. The timing of Apple's addition to the DJIA hinged on
two stock splits: Apple's 7:1 last June and Visa's 4:1 on
March 19th this year. Apple's
split brought the stock price down closer to the median price in
the DJIA. The Visa split will reduce the technology weight in the
DJIA and make room for Apple. Among the current DJIA constituents,
AT&T has one of the lowest prices. Moreover, the DJIA is
over-weighted in telecommunications and AT&T and Verizon are
quite similar, though AT&T has a smaller market
capitalization."
Apple, headquartered in Cupertino,
CA, designs, manufactures, and markets mobile communication
and media devices, personal computers, and portable digital music
players.
The change won't cause any disruption in the level of the index.
The divisor used to calculate the index from the components' prices
on their respective home exchanges will be changed prior to the
opening on March 19. This procedure
prevents any distortion in the index's reflection of the portion of
the U.S. stock market it is designed to measure.
For more information, please visit http://www.djaverages.com.
The Dow Jones Industrial Average and Dow Jones Composite Average
also are members of the Dow Jones Averages family.
Following is a summary of the change:
DOW JONES
INDUSTRIAL AVERAGE- March 18, 2014
|
|
COMPANY
|
GICS ECONOMIC
SECTOR
|
GICS INDUSTRY
GROUP
|
ADDED
|
Apple
|
Information
Technology
|
Technology Hardware,
Storage & Peripherals
|
DELETED
|
AT&T
|
Telecommunication
Services
|
Integrated
Telecommunication Services
|
Additions to and deletions from S&P Dow Jones Indices
do not in any way reflect an opinion on the investment merits of
the companies involved.
About S&P Dow Jones Indices
S&P Dow Jones
Indices LLC, a part of McGraw Hill Financial, is the world's
largest, global resource for index-based concepts, data and
research. Home to iconic financial market indicators, such as the
S&P 500® and the Dow Jones Industrial Average®, S&P Dow
Jones Indices LLC has over 115 years of experience constructing
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www.spdji.com.
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Jones Indices receives compensation in connection with licensing
its indices to third parties.
For more information:
Dave
Guarino
Communications
S&P Dow Jones Indices
dave.guarino@spdji.com
(212) 438-1471
Soogyung Jordan
Communications
S&P Dow Jones Indices
soogyung.jordan@spdji.com
(212) 438-2297
David Blitzer
Managing Director and Chairman of the Index Committee
S&P Dow Jones Indices
david.blitzer@spdji.com
(212) 438-3907
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SOURCE S&P Dow Jones Indices