March 17--Shares of American Airlines Group rose 6.9 percent Tuesday to $53.69 after Standard Poor's announced the world's largest airline would be added to the popular S 500 Index.
American, with a large presence at O'Hare airport and an employer of about 8,800 in the region, will replace Allergan in the index after the close of trading Friday, S said.
S 500 component Actavis is acquiring Allergan in a deal expected to close this week.
Industry analyst Hunter Keay, of Wolfe Research, wrote in a note to investors that he also expects Chicago-based United Continental Holdings, parent of United Airlines, to be added to the S index. Delta Air Lines is already a component of the index.
When Delta was added, its stock received an immediate price boost, but then traded in line with its peers over the next several months, according to Keay. That implies the S 500 addition "is probably only a catalyst if you already own the stock," he wrote.
Fort Worth, Texas-based American Airlines Group is the holding company for American Airlines and US Airways, which merged in late 2013.
gkarp@tribpub.com
