Freedom: Alphabet’s inclusion in the Dow Jones index may support the company’s shares

Alphabet, Google’s parent company, will be added to the Dow Jones Industrial Average, replacing telecom operator Verizon. According to Freedom analysts, this decision could provide moderate support for the tech giant’s shares in the short term.

The Dow Jones Industrial Average is one of the oldest and most well-known U.S. stock indices. It includes 30 of the largest American companies representing various sectors of the economy. Inclusion in the index typically leads to additional demand for the stock from index funds and ETFs that track its composition.

According to Freedom analyst Vladimir Chernov, Alphabet’s inclusion in the Dow Jones is primarily technical in nature and does not change the company’s fundamental business valuation.

Alphabet remains one of the largest investors in the development of artificial intelligence. The company is actively expanding its AI infrastructure, developing its in-house Gemini models, and increasing capital expenditures, which is prompting a mixed reaction from investors.

Freedom believes that Alphabet’s further share performance will depend not so much on its inclusion in the Dow Jones as on the company’s ability to demonstrate financial returns on its large-scale investments in artificial intelligence. If upcoming quarterly results confirm the effectiveness of these investments, the shares may continue to rise. Otherwise, the positive effect of inclusion in the index may quickly fade.

This is not an individual investment recommendation.