Nike is not representative of the growing economy and is being left behind, making it a candidate for removal from the Dow Jones Industrial Average.
Too little corroboration in the last 3 days to call a trend (2 articles). Watching for it to gain traction.
Nike is increasingly viewed as unrepresentative of economic growth and is being discussed as a potential removal candidate from the Dow Jones Industrial Average. Weakness in related consumer discretionary names like Dick's Sporting Goods and Foot Locker reinforces the thesis that the athletic apparel and sporting goods sector is lagging broader economic expansion.
Index composition changes carry material implications for capital flows because passive funds tracking the Dow must mechanically rebalance when constituents change. Additionally, removal from a flagship index can accelerate outflows from a stock as investors reassess its relevance to their strategic allocations.
"Dick's Sporting Goods cut its full-year guidance Wednesday on weakness in its Foot Locker chain, sending shares of the consumer discretionary stock down more than 30%. This signals incremental murkiness around NKE's turnaround progress."
"Woods said Nike's stock is not representative of the growing economy. 'It's actually being left behind.' Woods said Nike shares are trading at 2017 lows and could be next to be replaced."