Bank Of America Among The Shares To Be Replaced At Dow Industrials

Bank Of America Among The Shares To Be Replaced At Dow Industrials

The Bank of America Corp, Hewlett-Packard Co and Alcoa Inc are set to be replaced at the Dow Jones Industrial Average in the coming week. This is the biggest change in the index in nearly a decade. The Bank of America will be replaced by Goldman Sachs Group while HP will be replaced by Visa Inc. On the other hand, Alcoa will be supplanted by Nike Inc.

These changes will be effective once trading closes on September 20. It also gives an indication of the decline in the share prices and sub-par performance of these companies, according to the S&P Dow Jones Indices LLC. The S&P Dow Jones Indices is a component of McGraw Hill Financial Inc.

Bank of America stocks are at $14.48, way below the 2007 level of $50. HP shares were at $22.36, lower than the 2010 level of $50. Alcoa stocks were at $8.08 from the $50 level in 2007.

On the other hand, shares of Goldman Sachs increased by 2.3 percent recently. Nike and Visa increased by 1.8 percent and 2.1 percent respectively. No statements were issued by any of the spokespersons of these companies.

These changes are not expected to affect the index level, according to S&P Dow Jones. The index increased by 15 percent for the year at 15,063.13.

The current shakeup is the biggest move at the Dow since April of 2004. During this time, AT&T Corp, International Paper Co. and Eastman Kodak Co. were replaced by the American International Group Inc, Verizon Communications Inc., and Pfizer Inc.

Last year, Kraft Foods Inc. was replaced by the UnitedHealth Group Inc following the spinoff of the grocery business of the international snacks company. The reduction in the size of Kraft was deemed to be unsuitable for blue chips by the committee that decides on the makeup of the blue chip averages.

It can be recalled that Chevron Corp and Bank of America replaced Honeywell International Inc. and Atria Group Inc. in February 2008.

Posted by James Fried on Wednesday September 11 2013, 2:36 AM EST. Ref: WSJ. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0