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Nov. 29 (Bloomberg) -- Alaska Air Group Inc. was picked to replace AMR Corp. in the Dow Jones Transportation Average after the parent of American Airlines filed for bankruptcy.
AMR was part of the 117-year-old measure since 1982, according to a statement from Dow Jones Indexes. The 20-stock gauge is used by some traders and investors as a proxy for the U.S. economy. The changes will take effect before the open of trading on Dec. 2.
Alaska has reported 10 straight quarters of net income, and earnings doubled last year. Profit will increase 21 percent in 2011, according to the average analyst estimate in a Bloomberg survey. Shares of the Seattle-based company have gained 15 percent this year, compared with a 7.6 percent drop in the Dow Jones Transportation Average.
AMR sank 84 percent today and has lost 97 percent this year. The Fort Worth, Texas-based company posted losses in 14 out of the past 16 quarters. It filed for Chapter 11 bankruptcy after failing to secure cost-cutting labor agreements and sitting out a round of mergers that dropped it from the world’s largest airline to No. 3 in the U.S.
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