The opportunities we continue to discover and develop worldwide. What makes our future so exciting? Our range of products and services, and our diversified portfolio of businesses. Global, progressive, and enriched by a long heritage of innovation and achievement. NAIC: 334512 Automatic Environmental Control Manu- facturing for Residential, Commercial, and Appliance Use 334511 Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing 334513 Instruments and Related Products Manufacturing for Measuring, Displaying, and Controlling Industrial Process Variables 334290 Other Communications Equipment Manufacturing Stock Exchanges: New York London Paris Amsterdam Brussels Geneva Zurich Basel CNBC's Yun Li, Fred Imbert and Kevin Stankiewicz contributed reporting.Incorporated: 1927 as Minneapolis-Honeywell Regulator Co. Shares of Salesforce and Amgen jumped 4% in extended trading on Monday following the news, while Honeywell advanced 3%. Exxon, Pfizer and Raytheon were all down about 2% in after hours trading.
The Dow has gained about 55% from its March 23 low, sitting 4% below its all-time high of 29,568.57 from Feb.12. Walgreens is the most recent addition to the Dow, and its shares are down 40.9% since it was added on June 26, 2018. "I'm not sure there is much difference between PFE and Amgen nor Honeywell and Raytheon."Ĭompanies typically covet a spot on the blue chip index, but it doesn't necessarily come with a boost for shares. "I'm surprised by the news as energy still powers the world but we know how out of favor it is," said Peter Boockvar, chief investment officer at Bleakley Advisory Group. The announcement puzzled some on the Street. For Honeywell, it's a return to the Dow after it was removed in Feb. It was first added as Standard Oil of New Jersey in 1928 when the benchmark expanded from 20 stocks to 30. The moves "help diversify the index by removing overlap between companies of similar scope and adding new types of businesses that better reflect the American economy," S&P Dow Jones Indices said in a statement.Įxxon has been a Dow component for nearly 100 years. Monday's stock swap announcement also encapsulates the changing picture of the market. The last time three simultaneous changes occurred was 2013, when Goldman Sachs, Nike and Visa replaced Alcoa, Bank of America and Hewlett-Packard. So we expect to see a lot of action on it, a lot of buying and selling," he said. Silverblatt added that the 3-stock shake-up is "extremely unusual." "This is a massive amount, especially when you add in Apple, which re-weights it significantly. Salesforce will be the sixth most weighted stock, and Honeywell the 11th, according to S&P Dow Jones Indices. 2015, and said that Apple's coming split will be just the 18th since 1999.īased on Monday's closing prices, UnitedHealth Group will become the most heavily weighted component in the Dow, followed by Home Depot and Amgen. Silverblatt noted that the last was Nike's 2-for-1 split in Dec. Without Apple's heavy-lifting, many on Wall Street believe the Dow could have a harder time catching up with the S&P 500 and the Nasdaq Composite, which have already reclaimed their respective records. The tech name has contributed more than 1,400 points to the Dow in 2020, making it by far the largest contributor. company to hit a $2 trillion market capitalization.
The S&P 500, on the other hand, is based on market capitalization.Īpple has soared more than 70% this year, on the way becoming the first U.S. The 124-year-old blue-chip average is price-weighted, meaning stocks with higher share prices are given greater weighting. "By adding Salesforce, you can come back to 23.1% of the Dow being in technology."Īs a result of Apple's 4-for-1 stock split, its ranking is set to drop from the most heavily-weighted component down to the 17th most influential.
It's a significant decline," Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, told CNBC. "Basically Apple - by itself - took the technology within the Dow down from 27.6% to 20.3%. The shake-up was prompted by Apple's decision to enact a 4-for-1 stock split, which would significantly reduce the benchmark's exposure to the information technology sector. The changes will go into effect before the market opens on Monday, August 31.