Sears shares fall after retailer is dropped from S&P 500
(Reuters) - Sears Holdings Corp (SHLD.O) shares plummeted more than 8 percent on Thursday on news that the U.S. retailer will be replaced by chemical maker LyondellBasell Industries NV (LYB.N) on the S&P 500 index .SPX.
S&P Dow Jones Indices LLC said late on Wednesday that the retailer, controlled by hedge fund manager Edward Lampert, was no longer considered representative of the index.
Whenever an index makes a change, fund managers have to adjust their holdings accordingly, which results in the increase or decrease in the share price of the companies affected by the change.
Imperial Capital Managing Director Mary Ross Gilbert tied Thursday move in Sears shares entirely to the announcement from S&P Dow Jones Indices.
Shares of the operator of Sears department stores and the Kmart discount chain were down 6.8 percent at $53.53 on Thursday morning. They touched a low of $52.77 earlier in the session.
The company's sales have fallen every year since 2005, when Lampert merged two iconic U.S. retail chains - Kmart and Sears Roebuck and Co - in an $11 billion deal.
(Reporting by Dhanya Skariachan and Chuck Mikolajczak; Editing by Leslie Gevirtz)
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