Stocks on path to 40,000

The Dow Jones Industrial Average reached a key milestone on Thursday, the latest in a more than 100-year ascent that’s involved an everchanging group of stocks.

The closely followed average on Thursday broke above the 40,000 marker for the first time in its history. But the index today looks far different than it did a century ago — or even just a few decades prior.

The average was created by Charles Dow in 1896 with just 12 industrial stocks. Paired with the Dow Jones Transportation Average, the two were collectively meant to offer a gauge for the broader economy. After eight stocks were added in 1916, followed by another 10 in 1928, the Dow has stood for nearly a century at 30 members.

To reflect the country’s industrial presence, companies have been added and removed over time as the economy has evolved. Take technology, for example. There are now seven stocks from the sector in the index, reflecting its growing prominence in the equity market and corporate world.

A committee governs stock selection for the esteemed group of blue-chip stocks, according to S&P Dow Jones Indices, the S&P Global-owned company that operates the benchmark. Though it has no defined rules, the group typically analyzes a firm’s reputation, growth over a long period and relevance to investors. A sector’s representation in the Dow compared with its place in the broader market can also play a role.

The sole caveat: No utility or transportation stocks are included, given the existence of the Dow Jones Utility Average and Transportation Average.

With the Dow hitting its next big milestone, CNBC looked back at which companies comprised the index at previous important moments.

It may be hard to imagine given the recent achievement, but the Dow traded below 1,000 until the early 1970s.

The index broke above the level on Nov. 14, 1972 — a little over a week after Richard Nixon won the presidential election. It finished that year up more than 14%.

During the year with “Rocket Man” and “Lean on Me” topping music charts and “The Godfather” in theaters, industrial and material stocks still made up a sizable chunk. Some names like General Foods and International Harvester have been acquired or no longer exist. A portion of the companies that originally made up this group, such as Chevron and Procter & Gamble, are still members.

In 1995, “Clueless” and “Toy Story” were capturing the attention of American youth, and Oasis had just released the hit song “Wonderwall.” By this time, with the addition of stocks like McDonald’s and Walt Disney, nearly half of the members in the index today had held membership.

March 1999 was also part of the peak of the dot-com bubble, which would give way to a major market crash starting just about one year later. Still, tech had not yet emerged as a major part of the Dow, with key names like Apple and Microsoft yet to earn a spot. And Alcoa, Sears and Union Carbide were still members.

About five out of every six stocks in the Dow are still in it slightly more than seven years later. By 2017, several of those important tech names had been added, in addition to stocks like Visa, Travelers and Nike that are still around today.

By 2020, as many workers and students were sent home for health precautions, tech had only grown in its relevance within the index. One of the latest editions was cloud software stock Salesforce. It replaced Exxon Mobil, which had been in the index for more than nine decades.

Much of that rally and the subsequent gain this year has been powered by investor excitement around artificial intelligence. And a group of mega-cap technology stocks dubbed the “Magnificent Seven” has been credited with an outsized influence as the market climbed to new heights. One of those members — e-commerce giant Amazon — got swapped in for Walgreens earlier this year to make the Dow what it is today.