Kraft Foods Inc. will be overtaken by UnitedHealth Group Inc. in the Dow Jones Industrial Average. The decision of the company being replaced by the other has been taken after Kraft Food Inc. declared that it will be drawing out from the North American grocery business.
Further, on Friday S&P Dow Jones has notified that the change will be implemented on September 24 after the trading will commence. It has been reported that following the spinoff, Kraft Foods will be called as Mondelez International Inc.
The Dow committee asserted that they suppose that the reduced market capitalization and probably les ration of profit made from the US markets by the Mondelez company, places it as at a position where it cannot represent the U. S. large-capitalization market space.
The recent change will the first ever administered since the year 2009. The 116-year old stock standard will be including the biggest U. S. health insurer, UnitedHealth which will be replacing Kraft Food.
As per the statement given by the index provider, the company plays an important role in the US economy due to its health-care expenses. Peter Jankovskis said, “Putting UnitedHealth there makes a lot of sense. Health-care expenditures have become such a large part of the economy and particularly health insurance”.