Kraft to Replace AIG in Dow Jones

Kraft Foods Inc. (KFT) will replace American International Group Inc. (AIG) in the Dow Jones Industrial Average, effective the opening of trading on September 22.

The last time the 112-year old stock index - considered the leading stock-market barometer in the world - was changed was on February 19, 2008, when two of the 30 stocks were replaced.

Robert Thomson, managing editor of The Wall Street Journal, said:

We are refraining at this point from adding another stock in the financial industry because of the extremely unsettled conditions. We realize this decision leaves the Dow Jones Industrial Average under-weighted in financials, and we will address this situation in due course.

The Journal’s top news editor oversees the makeup of the Dow.

Mr. Thomson said:

We are adding Kraft because the Dow Jones Industrial Average had no representation in food products.

John Prestbo, editor of Dow Jones Indexes said:

There are no pre-determined criteria for a stock to be added or deleted, though we intend that all components be established U.S. companies that are leaders in their industries.

The changes won’t cause any disruption in the level of the index, Dow Jones said.

AIG has been in the Industrial Average since April 1, 2004.