Red Hat to join S&P 500
Getting in often prompts a rally
_{BY ALAN M. WOLF - Staff Writer
Published: Sat, Jul. 18, 2009 02:00AM
Modified Fri, Jul. 17, 2009 10:22PM}

The financial turmoil that keeps claiming victims on Wall Street has created an opening for Raleigh-based Red Hat.

The software maker will replace floundering CIT Group in the iconic Standard & Poor's 500 Index next week. In addition to the cachet the move gives Red Hat, companies added to the S&P 500 typically rally as investors who track the index buy shares.

Red Hat's stock has climbed more than 50 percent so far this year on investor optimism that its cheaper Linux computer-operating software is winning customers during the downturn. On Friday, the stock closed at $20.60, down 26 cents, but it jumped as much as 10 percent in late trading after the S&P announcement.
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The change will be made after the close of trading July 24. There are only a dozen publicly traded companies with North Carolina headquarters in the S&P 500. In the Triangle, that list includes only one: Raleigh-based Progress Energy.