Business

Salesforce, Amgen, Honeywell to be added to reshuffled Dow

In a major reshuffling, Salesforce, Amgen and Honeywell International will be added to the exclusive 30-member Dow Jones Industrial Average.

The companies will replace Exxon Mobil, Pfizer and Raytheon Technologies, respectively, according to the S&P Dow Jones Indices. The change is planned to take effect when markets open on Monday.

The move was prompted by a pending 4-to-1 stock split by Apple, which also goes into effect that day.

While Apple’s split won’t reduce its record-breaking $2 trillion market value, it will “reduce the index’s weight” in the Dow’s information technology sector, and “the announced changes help offset that reduction,” the S&P Dow Jones Indices, which manages the Dow, said in a statement.

The companies being added “also help diversify the index by removing overlap between companies of similar scope and adding new types of businesses that better reflect the American economy,” the statement added.

The shakeup also adds some pricier shares to the index.

Salesforce.com, based in San Francisco, is a leader in cloud computing. Its shares have climbed more than 30% since the start of the year, and were trading at $208.29 per share when markets closed Monday.

Shares for the company it’s replacing, oil giant Exxon Mobil, have plummeted more than 40% in that same time. As of Monday’s market closing, they were trading at $42.20 a share.

Shares for Biotech giant Amgen, headquartered in Thousand Oaks, California, closed at $235.57 on Monday. It’s replacing pharmaceutical giant Pfizer, whose shares closed at $38.84 on Monday.

Stock for the conglomerate Honeywell, based in Charlotte, North Carolina, was trading at $159.41 as of Monday’s market closing. Shares of Raytheon Technologies Corp., the aerospace manufacturing company Honeywell will replace, however, have shed more than 30% in 2020, closing Monday at $61.86.

The shakeup marks the end of an era for Exxon Mobil, which had been a member of the Dow since 1928. Its replacement, Salesforce, was founded in 1999.

Source:

abcnews.go.com

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