Dow Industrials Delists GM As Well As Citigroup
Dow Jones and Company stated Monday that it would be adding two new corporations to its industrial average. The two businesses are Travelers and Cisco Systems. Of course, when two go into the average, two have to leave.
Given the news that has occurred with GM over the past few months, it is a no brainier that GM would be cut from the average. However, Citigroup was also let go.
Travelers was once a subsidiary of Citigroup and will help maintain the representation of financial companies in the average.
Citigroup has had a fairly bumpy year with subprime lending, the credit disaster, and ultimately the downturn taking huge cuts from Citigroup. Citigroup is the 2nd fiscal company to be dropped from the average throughout this recession, the first being AIG. AIG was taken off the average in September after the government took an 80% interest in the corporation and lent it several billion dollars in bailout money.
The Dow industrial average is made up of 30 stocks. These stocks are a gauge of the market and what the general public ordinarily looks at to determine the health of the markets as well as the financial system. It is at present made up of (on top of Travelers and Cisco) 3M (MMM), Alcoa (AA), American Express (AXP), At&t (T), Bank of America (BAC), Boeing (BA), Caterpillar (CAT), Chevron Corporation (CVX), Coca-Cola (KO), DuPont (DD), ExxonMobil (XOM), General Electric (GE), Hewlett-Packard (HPO), The Home Depot (HD), Intel (INTC), IBM (IBM), Johnson & Johnson (JNJ), JPMorgan Chase (JPM), Kraft foods (KFT), McDonalds (MCD), Merk (MRK), Microsoft (MSFT), Pfizer (PFE), Procter & Gamble (PG), United Technologies Corporation (UTX), Verizon Communications (VZ), Wal-Mart (WMT), and Walt Disney (DIS).
The changes will go into effect next Monday.
Citi has been on the Dow industrial average for 12 years, at the time it was listed as Citicorp. It turned into Citigroup in 1998 when Travelers Group merged with Citicorp. In 2002, Travelers was spun off once more and has been a unconnected corporation ever since. So, it is a bit odd that the parent business has fallen off the average and has been shown the door by its subsidiary.
In reality, Travelers is taking AIG’s previously held location in the average. The core product of both businesses is the similar; casualty insurance sales.
GM has to get its actions together to even be considered before it is listed on the average yet again. It will likely be years for the once burly auto business to see the tops of any list. However, I do believe that bankruptcy was a footstep in the correct direction. If it were left up to its own devices, GM would have been filing for bankruptcy a year ago, if the government wouldn’t have stepped in. Worse, if they didn’t file for bankruptcy and couldn’t reform, the government would have lost all of our money in the GM “risk” and would be throwing money into a endless pit.
Get the newest on Dow Industrial Average while reading up on a number of stock information.
Fetch useful advice about the topic of forex investment – please study this webpage. The time has come when concise info is really only one click away, use this possibility.
Did you enjoy this post? Why not leave a comment below and continue the conversation, or subscribe to my feed and get articles like this delivered automatically to your feed reader.
Comments
No comments yet.
Leave a comment