Gap Cut From S&P 500
Gap Inc. is losing its spot at the top of the stock market and getting booted from the S&P 500.
S&P Dow Jones Indices said late Wednesday that Gap would move down to the S&P MidCap 400, replacing Jack in the Box Inc.
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Constellation Energy Corp., which is in the process of being spun out of Exelon Corp., will take Gap’s place in the S&P 500.
“The Gap is more representative of the mid-cap market space,” S&P said of the decision.
Investors took the switch in stride, sending shares of Gap up 2.9 percent to $18.07 when the market opened Thursday morning.
The S&P 500 was up slightly, rising 1.2 percent to 4,403.29 in early trading, as investors weighed news that the U.S. economy grew at an annualized rate of 6.9 percent last quarter.
While that was better than the 5.3 percent expansion expected, investors are still anxiously watching the Federal Reserve, which plans to start ratcheting up interest rates to fight inflation and cool the economy back down.
The stock market switch will not impact Gap’s business, but it should cause a turnover in its investor base, as many large hedge funds promise their own investors to put their money to work at companies with a certain profile.
In general, fashion shares were on the rise at the start of trading. Among the stronger gainers were Levi Strauss & Co., up 10.3 percent to $22.42; Kontoor Brands Inc., 6.4 percent to $48.57; Victoria’s Secret & Co., 4.8 percent to $56.05; American Eagle Outfitters Inc., 4.5 percent to $23.64; Capri Holdings, 4.3 percent to $57.04; PVH Corp., 4.1 percent to $95.85, and Ralph Lauren Corp., 4 percent to $109.99.
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