Google Inc. will replace oil and gas producer Burlington Resources Inc. in the S&P 500 index, Standard & Poor's said Thursday, sending the Web search leader's shares up 9% in after-hours trading.
The move, which takes effect after the close of trading March 31, means managers of index funds that are designed to track the S&P 500 will have to add Google shares to their holdings.
The move adds some volatility to the index and provides new respectability for an upstart company that regularly has confounded Wall Street since going public in August 2004 with policies such as refusing to issue financial forecasts.
"I see more respect for Google because it made it to the big time and rightfully so based on revenues and market capitalization," said Richard Sichel, chief investment officer at Philadelphia Trust Co., where he helps oversee a $1.5-billion portfolio.
Shares of Google, which went public in August 2004 at $85 a share, jumped $30.62 to $372.51 after-hours trading. The stock gained $1.67, to $341.89, in regular trading.
Burlington Resources is exiting the index because it is being acquired by ConocoPhillips.