Alphabet joined the Dow Jones Industrial Average on Monday, replacing Verizon Communications in the 30-stock index, S&P Dow Jones Indices said.
Alphabet stock rose roughly 4% on its first day as a Dow component
S&P Dow Jones Indices said Alphabet’s portfolio — spanning advertising, cloud infrastructure, artificial intelligence, hardware, autonomous mobility, healthcare technology, and media distribution — makes it a stronger representative of the Communication Services sector than Verizon. Because the Dow is a price-weighted index, Verizon had accounted for only about half a percentage point of the benchmark due to its lower share price, the index manager said. The scale of that required purchasing is expected to be small, however: as of December 31, 2024, assets indexed to the Dow totaled around $115 billion, a fraction of the approximately $20 trillion benchmarked to the S&P 500 — an index where Alphabet already holds membership, according to Reuters.
Alphabet stock is also already included in the Nasdaq 100, further limiting forced buying tied to the index change. Despite Monday’s gain, Alphabet stock has faced sustained selling pressure in June. Over the prior seven weeks, the stock had closed lower in six of them, putting it on pace for its most damaging month since February of last year, according to CNBC.