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History of the Dow Jones
Utilities Index
The Dow Jones Utility Average is the youngest of the three Dow
Jones Averages, having made its debut in January 1929. According
to analysts who study the averages, a rise in utility stock
prices indicates investors anticipate falling interest rates.
That's because utilities are big borrowers and their profits are
enhanced by lower interest costs. Conversely, the utility
average tends to decline when investors expect rising interest
rates. Because of this interest-rate sensitivity, the utility
average is regarded by some as a leading indicator for the stock
market as a whole.
Unlike the industrial average, which has undergone more than 100
changes in its nearly 104 years, the utility average has been
relatively unaltered. Most of the changes in recent years are
the result of mergers and acquisitions.
Historical Dow
Jones Utilities Indicator
Originally, the utility average started with 18 stocks, and six
months later, on July 1, 1929, the number was increased to 20.
The average was reduced to 15 stocks on June 2, 1938, and has
remained at that level ever since.
For trivia buffs, the original utility average included American
Telephone & Telegraph Co., which was removed in 1938 and added
to the Dow Jones Industrial Average in March 1939, supplanting
International Business Machines Corp.
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DOW
Signals
Past Month |
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3%
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5%
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Compound |
Compound
Margin |
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As of 9/1/2010 |
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