Every Company In and Out of the Dow Jones Industrial Average Since 1928
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Every Company In and Out Of The Dow Since 1928
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The Dow Jones Industrial Average (DJIA) is reported on daily by every major finance and media platform—a testament to its importance and relevance in global financial markets.
The market benchmark has a rich history embedded alongside America’s rise as a global superpower in the 20th century, and the inflows and outflows of companies on the 30 stock index coincide with broader secular trends. For example, the delisting of many industrial stocks over time encapsulates America’s transition towards a service-based economy. Meanwhile, the addition of tech companies in the last few decades paints a similar picture of change.
Today’s infographic looks at Dow data spanning over nine decades, all the way back to the tail end of the Roaring Twenties.
Crank Up The Volatility
An increasingly competitive and accelerating business landscape results in greater churn for stock market indices.
In fact, in the 92 years of activity visualized for the DJIA, there were 93 changes in its composition. This is not surprising, as the average duration of a company’s tenure on American indices has been trending down for decades—that said, 63% of Dow changes occurred in the second half of the 92 year sample period.
The current iteration of the DJIA includes some long-serving constituents, with the average length of companies in the index sitting at 20 years. General Electric was the last standing member of the original group from 1928, but in 2018, they were replaced by Walgreens.
2020 has also brought with it some fresh faces, including three changes so far. They include Salesforce for ExxonMobil, Amgen for Pfizer, and Honeywell International for United Technologies. Here’s a full list of the current companies in the index:
|Company||Market Cap (B)||TTM Revenue (B)||YTD Stock Performance|
|Goldman Sachs Group||$69.3||$18.2||-14.4%
|Johnson & Johnson||$392.2||$80.5||0.8%
|Merck & Co.||$209.9||$47.2||-10.0%
|The Travelers Companies||$27.6||$28.6||-21.6%
|United Health Group Inc.||$297.4||$195.1||3.5%
|Walgreens Boots Alliance||$31.3||$138.7||-40.0%
Although all the stocks in the DJIA are intended to be in line with broader economic trends, the similarities end there. For some DJIA stocks, 2020 has brought growth and opportunity—for others, quite the opposite.
YTD stock price performances range vastly from a high of 55% to a low of -49%. Perhaps it serves as no surprise that the best performing companies serve in the tech space like Apple, Microsoft, and Salesforce, while the worst performing are the likes of Boeing and Chevron.
A Sign of the Times
The three changes in 2020 can best be described as modernizing the Dow.
The delistings include businesses in industries such as Aerospace & Defense and Big Pharma. But the most monumental exit? ExxonMobil, which was once the biggest company by market capitalization in America.
Their fall from grace best symbolizes the state and direction the world is headed towards.
Just 20 Stocks Have Driven S&P 500 Returns So Far in 2023
From Apple to NVIDIA, megacap stocks are fueling S&P 500 returns. The majority of these firms are also investing heavily in AI.
Just 20 Stocks Have Driven Most of S&P 500 Returns
Just 20 firms—mainly AI-related stocks—are propping up the S&P 500 and driving it into positive territory, signaling growing risk in the market.
The above graphic from Truman Du shows which stocks are making up the vast majority of S&P 500 returns amid AI market euphoria and broader market headwinds.
Big Tech Stock Rally
Tech and AI stocks have soared as ChatGPT became a household name in 2023.
The below table shows data from last month, highlighting that just a small collection of companies drove most of the action on the U.S. benchmark index.
|Company Rank||Name||Contribution to S&P 500 Return||Average Weight|
|7||Alphabet (Class A Shares)||0.34%||1.72%|
|8||Alphabet (Class C Shares)||0.31%||1.53%|
|10||Advanced Micro Devices||0.16%||0.39%|
|Top 20 Companies||7.05%||29.17%|
*Based on the Vanguard S&P 500 ETF as of April 11, 2023. Source: Vanguard S&P500 ETF, Bloomberg.
Microsoft invested $10 billion into OpenAI, the creators of ChatGPT. It has also integrated generative AI into its search engine Bing. This large language model is designed specifically to make search capabilities faster, generate text, and perform other automations.
Also of interest is NVIDIA, which is the most valuable chipmaker in America. It sells $10,000 chips called A100s that allow machine learning models to run. These models perform multiple tasks simultaneously to develop neural networks and train AI systems, including OpenAI’s ChatGPT. Companies that are developing AI-related services, such as chatbots or image generation, may use up to thousands of these chips.
Despite being the world’s most valuable company and a key driver of returns, Apple is an outlier among tech giants with no major projects announced in AI (so far).
Implications of Market Divergence
The problem with the strong gains seen in a few select AI-related stocks is that it clouds wider stock market performance.
Without the AI-led rally, the S&P 500 would be returning -1.4%. as of May 17, 2023.
4. AI is fueling the stock market
A handful of stocks are spearheading the S&P 500's impressive 9% rally this year.
Here’s the kicker: if you excluded AI stocks, the S&P 500 would be down over 1% (according to Societe Generale). pic.twitter.com/SME1mJVpoW
— Rowan Cheung (@rowancheung) May 22, 2023
This form of steep divergence, known as market breadth, often signals higher risk in the market.
When more companies experience positive returns it is less risky than a small handful seeing the majority of the gains. Today market breadth is very narrow, and these companies make up over 29% of the entire index’s market capitalization.
How long AI-related firms mask the broader performance of the S&P 500 remains to be seen. A growing number of market pressures, from higher interest rates to banking uncertainty could add further challenges.
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