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Apple and Google to replace GM and Citigroup on Dow Jones?

crunchgear.com — There is talk around the ol’ internet watercooler that General Motors and Citigroup are about to be kicked off the Dow Jones Industrial Average due to their lackluster performance and long term outlook.

Who dugg this? Made popular Mar 11, 2009

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  • dmitriy87, on 03/10/2009, -3/+53Apple and Google definitely deserve to be there.
  • Bloodweaver, on 03/11/2009, -1/+49Now to remove the unemployed from the unemployment lists and everything will look fine.
  • Geat, on 03/11/2009, -1/+28per wikipedia:

    "The "industrial" portion of the name is largely historical—many of the 30 modern components have little to do with traditional heavy industry."

    'cuz knowledge is power!
  • Geat, on 03/11/2009, -3/+30If you were curious, here's the current list of DJIA companies (with symbols)

    3M MMM
    Alcoa AA
    Altria Group MO
    American Express AXP
    American International Group AIG
    AT&T T
    Boeing BA
    Caterpillar CAT
    Citigroup C
    Coca-Cola KO
    DuPont DD
    Exxon Mobil XOM
    General Electric GE
    General Motors GM
    Hewlett-Packard HPQ
    Home Depot HD
    Honeywell HON
    IBM IBM
    Intel INTC
    Johnson & Johnson JNJ
    JPMorgan Chase JPM
    McDonald's MCD
    Merck MRK
    Microsoft MSFT
    Pfizer PFE
    Procter & Gamble PG
    United Technologies UTX
    Verizon Communications VZ
    Wal-Mart WMT
    Walt Disney DIS
  • korvan504521, on 03/11/2009, -0/+18Those two make more sense.
  • inactive, on 03/11/2009, -0/+12Because you pick companies to represent a sector. There's little point due to overlap. That's why Coke is there, but Pepsi isn't. GM but not Ford, Caterpillar but not John Deere, etc. Certain sectors may have more than one representative if it is significant enough or there is enough variation in the sector to warrant it (banking, telcom, and tech each have multiple companies) but there is little point in loading the index and making it tech heavy. If MSFT does well, it stands to reason that the tech industry is performing well and by proxy so is AAPL.
  • marksism, on 03/11/2009, -4/+15HERRO ***** WOK
  • csuftech, on 03/11/2009, -3/+13Well Google is primarily a search advertising company, so I would argue that they are not represented by Intel, HP, Microsoft or IBM. Your point does appear to be valid about Apple though.
  • jonesyno, on 03/11/2009, -3/+13GOD DAMN MONGORIANS
  • trollick, on 03/11/2009, -2/+11Citigroup will also be renamed to *****
  • muckemuck, on 03/11/2009, -0/+8I read yesterday that it was Google and Cisco that would be put on the DOW...
  • inactive, on 03/11/2009, -0/+8GM and Citigroup definitely don't belong there.
  • inactive, on 03/11/2009, -0/+7No, because they are theoretically trying to gauge the performance of the NYSE as a whole, not just gauge the performance of "good" stocks.
  • youannoyme, on 03/11/2009, -0/+7"...the Dow follows 30 of the largest and most widely held public companies in the United States" So yes, if one of them falls below that ranking, they *should* be swapped out.
  • Geat, on 03/11/2009, -0/+6yes. and yes.
  • 2uantuM, on 03/11/2009, -4/+10Didn't citigroup just report profit yesterday?
  • Geat, on 03/11/2009, -0/+6it is. so is microsoft (which is on the DJIA)

    nasdaq and nyse are markets.

    DJIA, S&P 500 and so on are indices of stocks, which can be on any of the various markets
  • inactive, on 03/11/2009, -1/+5Not surprising!
  • normalkid0615, on 03/11/2009, -2/+6CitiPoop
  • inactive, on 03/11/2009, -1/+5Yes, it resulted in a 300+ surge on the Dow. This article must have been posted early in the day, before the Citigroup announcement. That or the author decided to ignore it.
  • KimmyGibbler, on 03/11/2009, -1/+5The Dow is designed to track the 30 largest US companies. Unless you're retarded, it shouldn't fool you. The NYSE and S&P indices track a more broad picture of the economy
  • megawiz, on 03/12/2009, -0/+3although they may "deserve" to be there, they should not replace an automotive and financial companies with electronics and search advertising companies... they are not in the same sectors.
    You would be under-representing some sectors to represent other sectors.

    As far as sensationalist reporting goes, this errs on the lower quality side
  • WibWobble, on 03/11/2009, -1/+4"the ol’ internet watercooler"

    If digg had smilies, that quote would be followed by a few.
  • batkins, on 03/11/2009, -1/+4True dat.
  • HookmasterCH47, on 03/11/2009, -1/+4I'd like an order of ***** beef.
  • inactive, on 03/11/2009, -0/+3You can't vote a CEO out of office.
  • RyeBrye, on 03/11/2009, -0/+3The DJIA is irrelevant. The S&P 500 is a much better index to watch.
  • iDiggr, on 03/11/2009, -0/+3*****, *****, *****.
  • SethEllis, on 03/11/2009, -0/+3I'm not sure if it should be Google and Apple, but citi and GM definitely need to go. It places a disproportionate emphasis on stocks like IBM. The result is that if these stocks like IBM go up or down even a little it results in a huge swing for the DOW. In order for the DOW to be a better indicator of the stock market these stocks need to be replaced.
  • wilhoitm, on 03/11/2009, -0/+3Can a NASDAQ stock be in the DJIA? Is MSFT a NASDAQ stock?
  • TheNik, on 03/11/2009, -0/+3A good handful of those companies need to be replaced. AIG? Home Depot? General Motors? Yuck!
  • nkassi, on 03/11/2009, -0/+24th thing: profit
  • petebot, on 03/11/2009, -0/+2The third thing: ????
  • johnwiz, on 03/11/2009, -0/+2meh, why not.
  • inactive, on 03/11/2009, -5/+7No they don't. Intel, HP, Microsoft, and IBM are already there representing the tech sector. Apple and Google bring nothing to the table that these companies don't already represent.
  • jbmcb, on 03/11/2009, -0/+2DJIA is supposed to be an aggregate index of the entire economy. GM is still the largest domestic auto maker, and the domestic auto industry accounts for 3-5% of GDP, so it's a good overall economic indicator, I think. You could make an argument that Ford should replace it, but a car company should still be on the list. Apple has relatively little market share, and, while very successful, I don't think it represents the computer market as a whole. Google, on the other hand, is a pretty good indicator to add for the internet sector.
  • timmeetheturtle, on 03/11/2009, -0/+2I love that the pic is woz dancing
  • KimmyGibbler, on 03/11/2009, -2/+4No, they reported that they expect to post a profit. But Google and Apple will likely post bigger profits and therefore deserve the spots on the Dow more than Citi
  • kaelyiesta, on 03/11/2009, -0/+2Reminds me of all the other accounting techniques to make our economic outlook more positive.
  • CLShortFuse, on 03/11/2009, -2/+4Fanboy sector

    But seriously speaking Apple has very popular and getting more and more popular everyday. It'll help the Dow Jones number. Also, they're the only cell phone makers on the list. On another note, how relevant is IBM any more?
  • Vonauda, on 03/11/2009, -0/+2I'm sorry to tell you this, but media players and personal computers aren't a sector. IBM is still relevant because it supplies most of the, as its name implies, business machines used by other Fortune companies. Google would represent a good addition since it represents an actual unrepresented sector, but adding a company to pad a number creates the false illusion that we were already living in.
  • aduzik, on 03/12/2009, -0/+1The DJIA has historically underrepresented the tech sector and overrepresented the financial services sector. Setting aside the fact the the DJIA is ridiculously useless as a measure of the overall market health, given its tiny sample size, it couldn't hurt to change its distribution to better reflect the overall distribution of the market.
  • wilhoitm, on 03/11/2009, -0/+1Tell that to Dell not Apple.
  • Vonauda, on 03/11/2009, -0/+1Tell what to Dell. What does dell have to do with a discussion about sectors on the Dow Jones?
  • aduzik, on 03/12/2009, -0/+1Now, the guy above you is explaining why they would swap them out. The DJIA tracks 30 of the biggest stocks. Citigroup and GM don't meet those requirements any more, by the index's standards, so they need replacements.

    They're not capriciously choosing companies from different industries to replace them just to make the index look better. There just aren't any other banks or auto manufacturers that would qualify. That gives them an opportunity to re-jigger the makeup of the index to better reflect the market as a whole. Whether you think that should be tech stocks or some other kind of stock is certainly a valid argument, but Google and Apple apparently do qualify as "big enough" by the index's standards.

    At any rate, I don't think you were being dugg down by Apple fanboys. I think they, like me, just disagree with your interpretation.
  • wilhoitm, on 03/11/2009, -0/+1I think the much waited Mac tablet is coming! Apple just ordered 10" touch screens from Wintek the iPhone touchscreen supplier.
  • inactive, on 03/11/2009, -1/+2Apple represent a segment that has enjoyed incredibly high performance that is does not paint an accurate representation of the entire software category.
  • aduzik, on 03/12/2009, -0/+1I know what the OP means. For a long time, it was my perception that the DJIA was based only on stocks on the NYSE, and that there were other indices that were based solely on NASDAQ stocks.
  • inactive, on 03/11/2009, -1/+2TAKE ORDER PREE.
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