Even people with no stock investments will let their decisions be influenced by swings in the Dow. When it's up, we tend to feel richer and spend more. When it's down — think back to the 500-point daily declines of 2008 — we tend to feel poorer and spend less.
There's good reason the Dow has pull over the financial mood of the country. Its 30 stocks account for 25 to 30 percent of the market value of all U.S. public companies, and about 40 percent of the dividends, Dow Jones Indexes estimates.
"Nothing of substance can happen in this economy without these companies feeling it," Prestbo says.
A handful of companies have an outsized impact on the index. The Dow is a price-weighted average, which means companies with more expensive stocks have more power to drive the average higher or lower.
If you invest $30 in a mutual fund tracking the Dow, you don't have a dollar riding on each company. Four times as much of your money would end up on Home Depot, which is trading around $45, than Alcoa, trading around $11.
IBM, the highest-priced stock in the Dow, had a giant influence last year. The Dow rose 5.5 percent in 2011, but without IBM it would have risen only 3.4 percent, according to Leiphart's calculations.
If you were to cut out the next three stocks on the list, McDonald's, Chevron and ExxonMobil, then the Dow would have finished down 0.25 percent for the year.
The flip side is that stocks like Chevron, Exxon Mobil, Microsoft and Intel trade well below the 13 times earnings for the full Dow. If they catch up, it could be enough to power the average to a record.
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