KRAFT Foods will replace American International Group in the Dow Jones Industrial Average after the biggest insurance company in the United States was taken over by the government.
Kraft, whose top shareholder is Warren Buffett's Berkshire Hathaway, will replace AIG next Monday, Bloomberg News said. News Corp's Dow Jones Indexes said it declined to add another financial company to the 112-year-old stock index "because of the extremely unsettled conditions" in global markets.
"When you think of a Dow stock, you think of a company with a stable, solid business model and an enduring franchise representative of the American economy. Kraft clearly fits that bill," said Christian Andreach, of Manning & Napier Advisors in Fairport, New York.
Kraft advanced 49 US cents to US$33.14 in New York yesterday. AIG added 20 US cents to US$2.25 after falling 96 percent since the start of the year.