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Market
indices are measures of performance of certain
aspects or sectors of a stock market. The most
important of these indices are
the Dow Jones
Industrial Average (DJIA), the Standard & Poor's
500 (S&P 500) and the NASDAQ Composite Index.
They are generally based
on the performance of selected U.S. stocks
within their exchanges. The purpose of these
indices is to assess the performance of certain
sectors of the U.S. stock market or the economy
as a whole.
The Dow Jones
Industrial Average (DJIA)
is the oldest U.S. market
index. It covers all major areas of the US stock
market, such as Industrial, retail, technology,
healthcare and others. It is composed of 30 blue
chip stocks that are among the largest in the
U.S. economy.
The S&P 500
is a well-known provider
of indices for the U.S. stock market. It
comprises the largest 500 companies and is used
by investors as benchmark for this market . It
covers about 70% of the value of the U.S. stock
market and comprises 380 industrial, 37utility,
73 financial, and 10 transportation stocks.
Although less popular than the DJIA, it is often
used as a more accurate measure of performance
of the U.S. economy.
The NASDAQ
Composite Index (The
National Association of Securities Dealers
Automated Quotation) includes a wide range of
companies and is arguably the most followed
index in the world. The recent surge in
popularity for technological stocks has launched
the NASDAQ into the spotlight. The Nasdaq-100
Index includes 100 of the largest non-financial
domestic and international companies listed on
the Nasdaq National Market tier of the Nasdaq
Stock Market Inc. The Nasdaq-100 index includes
major players in high technology, airlines,
department stores, and internet related
companies. |