Yahoo! Joins S&P 500 Stock Index
NEW YORK (Reuters) - Standard & Poor's, in a nod to the growing power of Internet companies, said on Tuesday it would add Internet media company Yahoo! Inc. (NasdaqNM:YHOO - news) to its influential S&P 500 Index of stocks.
Santa Clara, Calif.-based Yahoo, which closed down 13-3/8 to 212-3/4 in regular trading before the news was released, soared 22-1/4 in after hours trading, according to Instinet.
Yahoo will replace Canadian Laidlaw Inc. (Toronto:LDM.TO - news), North America's largest school bus company, which is being removed for lack of representation, Standard & Poor's said. The change will be affective after the close of trading on Tuesday, December 7, 1999.
Yahoo, with a market capitalization of $56 billion, will be added to the S&P 500 Computers (Software & Services) industry group.
Being included in the S&P 500 generally means strong demand for a stock because index funds, which seek to mimic the performance of the widely followed S&P 500, must buy into the stock to match the returns of the index.
Nearly a year ago, S&P added America Online Inc., (NYSE:AOL - news)the top Internet service provider and media company with more than 18 million subscribers, to the index.