NEW YORK (AP) — Amazon.com Inc. will be added to the Dow Jones Industrial Average, joining Apple, Walt Disney Co., Walmart and other companies that make up the 30-stock average.
S&P Dow Jones Indices announced Tuesday that the e-commerce giant will replace drugstore operator Walgreens Boots Alliance in the Dow stock before the start of trading on Monday.
The change was prompted by Wal-Mart's decision to conduct a 3-for-1 stock split, reducing its stock's weight in the index. The Dow Jones Industrial Average is a price-weighted index, meaning it gives more weight to stocks that trade at higher prices.
Seattle-based Amazon will join the Dow on the same day that Walmart implements its stock split.
“Reflecting the evolving nature of the U.S. economy, this change will increase DJIA's exposure to consumer retail, as well as other business areas,” S&P Dow Jones Indices said.
Amazon's entry into the Dow, Walgreens' exit, and Walmart's stock split will have a ripple effect on the weighting of Dow stocks. Once the transition is complete, Amazon's weight in the Dow Jones Industrial Average will rank 17th among the 30 stocks in the index. Walmart's weight drops from 17 to 26. UnitedHealth Group remains the most heavily weighted stock in the index.
Ride-hailing service Uber Technologies Inc. will also be added to the Dow Jones Transportation Average before trading opens on Monday, according to S&P Dow Jones Indices.
This change will expose the index to the ride-sharing industry.
San Francisco-based Uber will take over the position currently held by JetBlue Airways, whose weight in the index has fallen to less than half a percentage point due to the company's weak stock price.
The S&P Dow Jones Indices made the announcement after the closing bell. Amazon shares rose 1.4% in after-hours trading, and Uber shares rose 1.1%.
