Market Overview

The Curse Of The Dow Claims Another Victim

The Curse Of The Dow Claims Another Victim

It appears that even the world’s largest company has fallen victim to the recent curse of the Dow Jones Industrial Average. According to Bloomberg, since Apple Inc. (NASDAQ: AAPL) replaced AT&T Inc. (NYSE: T) in the Dow back in March, Apple has single-handedly cost the Dow 67 points.

You Heard It Here First

Strangely enough, the counterintuitive trend of new Dow members underperforming the stocks they replace has been happening for a while now. Back in March prior to Apple’s transition, Benzinga reported the pattern, and what it could mean for Apple and AT&T.

Incredibly, the last four Dow additions have each underperformed the stocks they replaced over the six months following the transition.

Related Link: Apple Shares At Critical Juncture: Will It Pop Or Will It Flop?

The Numbers

At the time of the transition, Apple’s stock was up more than 17 percent year-to-date, while AT&T shares were slightly down for the year.

Since the transition, Apple has traded down more than 10 percent, while AT&T has drifted higher by nearly 3.0 percent.

Other New Additions Helping Out

Ironically, the last class of Dow inductees from 2013, Goldman Sachs Group Inc (NYSE: GS), Nike Inc (NYSE: NKE) and Visa Inc (NYSE: V) have been three of the top Dow performers since Apple’s addition to the group. Together, the three have contributed a combined 257 points to the Dow during that time.

Rotten Apple

Apple’s stock has been under enormous technical pressure since the company announced disappointing iPhone sales numbers during Q2. The stock also recently dipped below its 200-day moving average for the first time since September 2013.

Image Credit: Public Domain

Posted-In: Dow Jones Industrial AverageEducation Top Stories General Best of Benzinga


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