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Business

Apple moves into Dow Jones industrial average

US technology giant Apple is to join the Dow Jones industrial average, reflecting the firm's position in the national economy and society. The iPhone maker will replace telecommunications company AT&T.

S&P Dow Jones Indices announced Friday in New York that the largest US company by market value, Apple, would be incorporated in the Dow Jones industrial average, which is a weighted average of the values of 30 major American corporations. Apple will join the index on March 19.

Since by tradition, only 30 companies are included in the Dow, a company needed to be dropped from the Dow to make room for Apple. That company was AT&T, which had been part of the Dow for the better part of a century.

The replacement is widely seen as recognition of the way in which communications and

technology have evolved over the last decades

.

"This is a sign of the times, and it might get everyone to look at the Dow more than they have been," Philadelphia Trust Co. investment officer Richard Sichel said in a statement.

Past its prime?

Apple boasts a market capitalization of $736 billion (677 billion euros) and will be by far the highest-valued publicly traded company in the index. The second biggest, ExxonMobil has a stock market capitalization of less than half that size, at $$360 billion.

The consumer electronics firm's promotion has been widely expected since Apple split its shares at a seven-for-one rate in mid-2014.

Prior to that, the company had been excluded because its share value was simply too high for the price-weighted index.

The departure of AT&T from the Dow Jones index leaves Verizon as the sole telecommunications firm in the list.

Firsthand Capital Management investment officer Kevin Landis called the Dow "a backward-looking index," adding he cringed when Intel and Microsoft were added.

"I'm cringing today; let's hope Apple can defy the forces of history."

hg/nz (Reuters, dpa, AFP)

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