Updated at 9:49 a.m. ET
Apple is in. AT&T is out. That's the word from the Dow Jones industrial average Friday morning.
The tech giant will replace the telecom giant after the close of trading on March 18, the S&P Dow Jones Indices said in a statement. The change is effective March 19.
"The index change was prompted by Visa Inc.'s 4:1 stock split which is scheduled to be effective at the same time," the statement read. "The post-split adjusted lower price of Visa will reduce the weighting of the Information Technology sector in the index. Adding Apple to the index will help to partially offset this reduction."
David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, said the timing of Apple's addition to the price-weighted Dow Jones Industrial Average hinged on two stock splits: Apple's 7:1 in June 2014 and Visa's upcoming 4:1 on March 19.
"Apple's split brought the stock price down closer to the median price in the DJIA," Blitzer said. "The Visa split will reduce the technology weight in the DJIA and make room for Apple. Among the current DJIA constituents, AT&T has one of the lowest prices."
The statement said that with AT&T's departure, telecom will be represented in the Dow Jones industrial average by Verizon Communications.
The Wall Street Journal reports that Apple's addition "caps the ascendancy of tech in the Dow that started in 1999 when software giant Microsoft Corp. and semiconductor maker Intel Corp. joined, a nod to the 'New Economy' boom then sweeping the U.S."
All three companies are listed on the Nasdaq.
The newspaper adds:
"The decision ends a long period of waiting for Apple investors and consumers, some of whom have questioned previous decisions by the index committee to add other companies to the Dow even as Apple rose to the top of the global market value and profitability tables.
"Apple's market value, recently $736 billion, reached as high as $775 billion last month, the highest on record."
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