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HARLEY EVICTED FROM TOP STOCK INDEX

Leading corporate ratings agency Standard & Poor’s Global is to delete Harley-Davidson from its benchmark S&P 500 index covering the share-price performance of what are regarded as elite American companies. BDN financial editor Roger Willis reports.

A 500-strong grouping of front-rank US firms qualifying for inclusion in this index are supposed to maintain market capitalisation of at least $8.2bn. Harley’s value sank to below half of that some time ago and currently languishes at around the $3.9bn mark. 

Amply demonstrated by BDN’s weekly Hog-ometer volatility gauge, Harley-Davidson stock has been subject to wild fluctuations, due to fairly pernicious short-term speculation — as its heavyweight cruiser sales declined and prospects grew doubtful. 

The iconic motorcycle brand’s shame-faced demotion into a S&P MidCap 400 wilderness is scheduled for 22 June. Besides significant loss of prestige, there is likely to be an impact on valuation too. Institutional equity investors that held Harley tranches on a long-term basis may cash in their chips. Many — typically cautious pension funds — restrict investments solely to S&P 500 members, to mitigate risk exposure. 

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