Stock Market Indices

There are several indices that are used to measure the performance of stocks as financial assets. National news programs report the levels of the Dow Jones Industrial Average and the NASDAQ Composite Index every business day. Sources of financial news also regularly report the S & P 500 or the Fortune 500 indexes.

The Dow Jones Industrial Average is an index of 30 blue-chip stocks that are representative of all large well-established American corporations. It is commonly reported in the news as an indicator of the overall direction of the stock market. The 30 stocks chosen for inclusion in the Dow Jones Industrial Average are periodically altered to reflect changes in the composition of the broader stock market. The 30 corporations included in the Dow 30 index in 2004 are listed in the table below.

Dow 30 Corporations
3M Corporation Intel Corpration
Alcoa Inc. J.P. Morgan & Co., Inc.
Altria Group Inc. Johnson & Johnson
American Express Company McDonald’s Corporation
American International Group Inc. Merck & Co., Inc.
Boeing Co. Microsoft Corporation
Caterpillar Inc. Pfizer, Inc.
Citigroup, Inc. SBC Communications, Inc.
E.I. du Pont de Nemours and Company The Coca-Cola Company
Exxon Mobile Corp. The Home Depot, Inc.
General Electric Company The Proctor & Gamble Company
General Motors Corporation United Technologies Corporation
Hewlett Packard Co. Verizon Communications
Honeywell International, Inc. Wal-Mart Stores, Inc.
IBM The Walt Disney Company
Table 4. The 30 corporations included in the Dow Jones Industrial Average, the most commonly reported index of the U.S. stock market.



The NASDAQ Composite Index represents the stocks of smaller or less-known companies.

The Fortune 500 and the S&P 500 are indices of 500 stocks that are broad measures of the overall stock market.