Updating the Dow (top ticking Energy?)

The editors at DJ have made a few changes to the venerable index: Out are Honeywell (HON) — which I have owned since the GE deal fell apart, and Altria (MO) which I sill have a small position in from the late litigation era.

In are Chevron (CVX) and Bank of America (BAC), which I don’t. The charts  of the buy and sell signals below are rather interesting.

The adds of Intel (INTC) and Microsoft (MSFT) late in 1999 top ticked the tech boom. Will the Chevron add do the same for energy?

Here’s the WSJ:

"Dow Jones & Co. announced that Bank of America Corp. and Chevron Corp. will replace Altria Group Inc. and Honeywell International Inc. in its benchmark Dow Jones Industrial Average effective Feb. 19.

The change is the first in four years and reflects the index’s continued shift away from industrial firms and into other sectors such as energy and financial services.

Excluding thinly traded Berkshire Hathaway Inc., Bank of America and Chevron are the two biggest U.S. companies by market capitalization which currently aren’t in the Dow industrials."

Interestingly, I noticed our ratings on both drops were "Neutrals"; the adds were split: BAC was a buy, CVX was a sell . . . charts after the jump.

Dropped:

Honeywell
Honeywell

Altria
Mo

 

Added:

Bank of America
Bac

Chevron Texaco
Cvx

Charts courtesy of FusionIQ

Source:
Bank of America, Chevron Added to Dow Industrials
KEVIN KINGSBURY
February 11, 2008 9:44 a.m.
http://online.wsj.com/article/SB120273890267958813.html

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What's been said:

Discussions found on the web:
  1. Justin commented on Feb 11

    I think this is CVX’s four time in the DJIA.

  2. zero529 commented on Feb 11

    I’m still getting over the fact that BAC comes out as a Buy.

  3. Justin T commented on Feb 11

    There must be another justin here…. Does anyone know when the Household Servay comes out?

  4. cinefoz commented on Feb 11

    The Dow is a tradition, but I think the S&P bird dogs the market much better. Just about everything tracks with the S&P in some way. The Dow seems more like an exercise than an indicator.

  5. Justin T commented on Feb 11

    Anyone want to wager on what day the dow drops by a 1000 points or more? Or do you think that the Wall Street influenced media, and the government, have things in check?

  6. Ross commented on Feb 11

    Justin T

    Valentines day comes to mind. Actually the Friday before Orthodox Easter.

  7. joe commented on Feb 11

    BAC = bag a crap

  8. ARISTOTLE commented on Feb 11

    Well, at least you can’t accuse them of top ticking BAC. Or could you? I guess they could fall a lot further.

  9. Justin T commented on Feb 11

    Godspeed, my good friend. It’s going to get good here…listening to the Obama speil in the background – populism is live and well. I understand their pain, I grew-up in it, but I don’t understand ignorance. READ…EDUCATE YOURSELF IN TRUTH, UNDERSTAND the misinformers. Those that Lord it over you. I hope he wins, it is time for those who are “more misfortune” to realize that the fortune that they have is because they live in a capitalist society – the worse of the best as Churchhill suggest. Unlike now, Churchill was in a situation where the rubber had to meet the road. I think the United States and The United Kingdom, are at a juncture, where their true leadership is in question because they (the rich amonst them) in their zeal to become more rich have sold the two socieities down the drain!

  10. Mich(IXIC^1881) commented on Feb 11

    I wonder what the DJIA would like since 1920s without any dropped stocks

    Further I wonder, if we were to go back as much as possible with the 100 or whatever oldest companies (GM, F, GE, Citi, etc.) , what would the chart look like

  11. jombi commented on Feb 11

    Justin T :
    Obama is nothing but an acute surgeon equipped with Bandaids and pacifiers….

    The republicans (less Ron Paul <- who we actually need) more or less want more of what we have been getting and are being blunt about it... The democrats are going to end up doing the same but are going to make the majority of the populous (Poor %80 of America) happy w/ it all by handing them hugs (healthcare) and bandaids (subsidization). The rich are going to get a little tap on the but and sent their own way and the middle class is going to get royally fucked <- mark my word. I sometimes wish there was a blog similar to this one but more geared towards politics and governance that cleared out the misinformation therein. So, get your head out of the clouds and ask yourself when has Obama answered the tough questions and addressed how he intends to solve them... *Wonders if he should kick off this politics/governance blog

  12. jopo commented on Feb 11

    well, if they would only get rid of a few more of those pesky industrials, we could start calling it the dow jones house of cards.

  13. badhaikuguy commented on Feb 12

    Barry, after examining the buy/sell signals on those charts I now fully understand why you’re looking for advertising revenue to refill the kitty! Buy high, sell low?!?!? Or maybe the charts are upside down?
    It’s no wonder you resorted to cocaine and heroin speedballs! But I salute you. If I had taken most of those signals I’d have put a gun to my head instead of a needle in my arm, bro. Methinks that Fusion needs its IQ tweaked just a tad! LOLOL!!!

  14. diogenes commented on Feb 12

    Barry,

    Have to agree with you.. including 2 laggards to the DOW reeks of top-ticking and an attempt to get institutional money to bolster the share prices of those 2 companies.

    And for god’s sake, Bank of America? The company that just purchased Countrywide Financial??.. Hello??!!

    Diogenes

  15. Greg0658 commented on Feb 12

    Jombi this stuff is from memory and maybe my slant on how it gets invented

    1> internet database that shows line items in budget
    2> health care that utilizes online medical files, bid process for piles of medicines, affordability thru socializing
    3> pull out of war for profit

    as far as this line:
    middle class is going to get royally fucked <- mark my word your right, the establishment will only give what they want to give, we will have to fight for or make due until otherwise I opt for they decide to give and we patiently wait

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