The Dow Jones Industrial Average (DJIA) was created in 1896 by Charles Dow and originally consisted of 12 companies: American Cotton Oil, American Sugar, American Tobacco, Chicago Gas, Distilling & Cattle Feeding, General Electric, Laclede Gas, National Lead, North American, Tennessee Coal and Iron, U.S. Leather, and U.S. Rubber.
At the time, these companies were among the titans of American industry. Of the original 12 companies, General Electric has remained in business and was a component of the DJIA the longest. When it was removed from the DJIA in 2018, it had been a Dow component continuously for over 120 years. It was also the only company that retained its place on the DJIA under its original name since the index's inception.Others were broken up, taken over, dissolved, or relegated to subsidiary status over the years.
Key Takeaways
In order to know the original Dow Jones Industrial Average Companies, follow these steps:
- Choose the 12 companies that best indicate the direction of the American stock markets.
- Add up their closing stock prices every day, and divide by 12.
- That was the Dow Jones Industrial Average in 1896. (Now it's 30 companies.)
Understanding the DJIA
Charles Dow was an American journalist who founded a financial news bureau, originally called Dow, Jones & Co., with a colleague, Edward Davis Jones.
Like any observer, Dow saw that many or most stocks tended to move like a wave in the same direction from day to day as investors reacted to events and expectations. He sought to put a number on that daily movement.
Dow chose 12 of the biggest and most influential corporations of the day. Each was a giant in its sector, and most reflected demand for the raw materials that fed the American economy, like coal, sugar, and oil.
At the close of every trading day, he added up all of their stock prices and divided by 12. That was the Dow Jones Industrial Average.
Introduced in The Wall Street Journal on May 26, 1896, the DJIA was the first index of stock market activity.
Changes to the Dow
As the country's industrial age came to a close, electricity became the dominant energy source and led to numerous technological advancements that were embraced by consumers. The economy shifted toward providing more consumer goods and technology-based services and products.
Dow Component Changes on Aug. 24, 2020
On Aug. 24, 2020, Salesforce, Amgen and Honeywell were added to the Dow, replacing Exxon-Mobil, Pfizer, and Raytheon Technologies.
Most of the original companies in the DJIA were removed from the list long before they went out of business. Then and now, the list of Dow components is revised periodically to remove companies that can no longer be seen as bellwethers and to substitute companies that have climbed to prominence.
The Original Dow 30
In 1928, the Dowwas expanded to include30companies. Thesecompanies have changed over the years, but the index still aims to representthe U.S. stock markets and the economy in general. The following are the first 30 Dow stocks, following the 1928 expansion:
- Allied Chemical
- American Can
- American Smelting
- American Sugar
- American Tobacco
- Atlantic Refining
- Bethlehem Steel
- Chrysler
- General Electric
- General Motors Corporation
- General Railway Signal
- Goodrich
- International Harvester
- International Nickel
- Mack Truck
- Nash Motors
- North American
- Paramount Publix
- Postum Incorporated
- Radio Corporation
- Sears Roebuck & Company
- Standard Oil (N.J.)
- Texas Company
- Texas Gulf Sulphur
- Union Carbide
- U.S. Steel
- Victor Talking Machine
- Westinghouse Electric
- Woolworth
- Wright Aeronautical
2023 Companies in the Dow
Below is a list of the companies included in the Dow as of July 2023.
- Salesforce
- Procter & Gamble
- Dow Inc
- Amgen
- 3M
- IBM
- Merck
- American Express
- McDonald's
- Boeing
- Coca-Cola
- Caterpillar
- JPMorgan Chase
- Walt Disney
- Johnson & Johnson
- Walmart
- Home Depot
- Intel
- Microsoft
- Honeywell
- Verizon
- Chevron
- Cisco Systems
- Travelers Cos.
- UnitedHealth Group
- Goldman Sachs
- Nike
- Visa
- Apple
- Walgreens Boots Alliance
How Many Original Dow Jones Companies Were There?
Charles Dow chose 12 companies from the biggest and most influential corporations by the end of the 19th century. Each was a giant in its sector, and most reflected demand for key raw materials like coal, sugar, and oil.
Is General Electric Still in the Dow Jones?
No, it's not; GE was removed from the DJIA in 2018. From time to time, the composition of the index changes. Like General Electric, some of the most iconic companies in U.S. history have been removed from the Dow Jones, such as AT&T, Sears, and General Motors.
What Is the Youngest Company in the Dow Jones?
Founded in December 1984, Cisco Systems is the youngest company in the DJIA. Cisco's rise is considered one of the most rapid in history.
The Botom Line
The Dow Jones Industrial Average (DJIA) was created in 1896 by Charles Dow and originally consisted of 12 companies, each considered a giant in its sector. The DJIA was first introduced in The Wall Street Journal as the first index of stock market activity. From time to time, the composition of the index changes, and as of 2023, the DJIA consists of 30 American blue-chip companies. After General Electric's removal in 2018, none of the original components of the DJIA remained listed on the index.
