S&P eases market cap rule for S&P 500 index

NEW YORK, Sept 25 (Reuters) - Standard & Poor's on Thursday lowered the minimum market values required for inclusion in three broad U.S. stock indexes, including its flagship S&P 500 .SPX, a move reflecting this year's declines in stock prices.

Effective immediately, S&P said companies need market values of $4 billion or more to be included in the S&P 500. It also set ranges of $1 billion to $4.5 billion for inclusion in the S&P MidCap 400, and $250 million to $1.5 billion to be eligible for the S&P SmallCap 600.

Previously, S&P required market values of at least $5 billion for inclusion in the S&P 500, $1.5 billion to $5.5 billion for the MidCap 400, and $300 million to $2 billion for the SmallCap 600, according to its website.

"Standard & Poor's feels that the new market cap ranges for its U.S. indices are appropriate, based on our review of recent market activity, comments from index users and the current U.S. market cap distribution," said David Blitzer, chairman of the index committee, in a statement.

The S&P 500, which includes most of the largest U.S. companies, has fallen 18 percent this year, and is down 23 percent from its record high set last October. S&P is a unit of McGraw-Hill Cos (MHP.N). (Reporting by Jonathan Stempel; editing by Carol Bishopric)