iPhone and Mac giant Apple will be shortly added to the 30-stock Dow Jones Industrial Average index on March 19. The move will mean exit of AT&T from the index. In order to balance the impact of technology sector on the index, the Cupertino, California-based technology major Apple will be added.
The 119-year old stock market barometer has been holding AT&T for almost 100 years. AT&T has been kicked out of the index a few times in the past as well. AT&T has not commented on the move announced by the index manager S&P.
Dow Jones is currently hovering around its all time high and the current move to change AT&T by Apple won’t have a big impact on the index. Apple stock ended marginally higher at $126.6 on Friday.
The technology companies have been performing better compared to other sectors. With the popularity of iPhone, iPad and Mac, Apple has managed to grow its revenue, year after year. The company now enjoys more than $750 billion market valuation, a first for any U.S. listed company.
In September 2013, Dow Jones index kicked out Bank of America, HP and Alcoa and added Goldman Sachs, Visa and Nike.
After the S&P decision to add Apple to Dow Jones, market analysts see a little positive impact for the stock. The stock has already outperformed the indices, especially after the company announced success of its iPhone 6 smartphone. Apple is working on many projects at the moment including an advanced electric vehicle, smartwatch, wearable technologies, Internet of Things and smarthome segment.
In June 2014, Apple announced stock split leading to 7 shares for every one share held. The addition to Dow Jones index will reaffirm Apple’s corporate reputation.