S&P 500 adds two, but not Google
New CBS and grocer Whole Foods set to join index at beginning of 2006; Visteon and MBNA out.
NEW YORK (CNNMoney.com) - The benchmark Standard & Poor's 500 index is getting two new members and Google is not one of them.
After the market close Tuesday, S&P announced that the new CBS, which is being spun off from Viacom (Research), and grocer Whole Foods (Research) will be joining its benchmark index when stocks open trading Jan. 3.
They will replacing auto parts manufacturer Visteon (Research), which has seen its market capitalization fall to $883 million on losses at the company and trouble in the sector. Also leaving the index is credit card issuer MBNA (Research), which is in the process of being purchased by Bank of America (Research).
S&P generally requires that stocks be public for at least a year before it can join the index. Google went public in August 2004, leading many analysts to believe it would be included in the next change in the index. S&P's statement did not mention anything about its decision about the continued exclusion of Google.
Inclusion in the index can help lift a stock as index fund managers have to buy shares to keep their holdings in line with the index. Similarly, when a stock is dropped from an index it can hit the stock as index managers sell their holdings.
For a look at trouble that could be ahead for Google in 2006, click here.