(Reuters) – The Dow Jones Industrial Average is losing General Electric Co (GE.N), the lone original component of the venerable blue-chip index that debuted in 1896.
S&P Dow Jones Indices said on Tuesday that the U.S. conglomerate would be pulled from the index before the stock market opens on June 26 and replaced by Walgreens Boots Alliance Inc (WBA.O).
GE’s stock slipped 1.5 percent in extended trade following the announcement, furthering a long decline this year that reflects worries on Wall Street about the company’s sprawling operations and disappointing quarterly results.
Walgreens Boots Alliance jumped 2.2 percent after the announcement.
GE’s share price significantly underperformed the broader market under the leadership of former Chief Executive Officer Jeffrey Immelt, who was replaced last year by John Flannery. Particular pain was caused by the financial crisis as losses mounted at its GE Capital unit.
Some index watchers had expected GE’s troubles to lead to its removal from the elite 30-stock Dow.
Changes to the Dow are made on an as-needed basis and selection is not governed by quantitative rules, according to published methodology for the index.
Reporting by Supantha Mukherjee in Bengaluru; Editing by Arun Koyyur and Tom Brown