Yahoo drops on S&P 500 debut
Shares of Yahoo shed almost 30 points as the company begins its first day of trading as part of the influential Standard & Poor's 500 index.
The shares dropped 8.15 percent, closing down 28.38 at 319.63 on volume of 24.9 million shares.
"It's just people doing profit taking…Since [Yahoo] went to the S&P 500, day traders are basically losing it," said Peggy Ledvina, an analyst at Dain Rauscher Wessels. "You won't see [Yahoo] lose all [its] gains."
Yesterday, shares of Yahoo soared as investors raced to buy a stake in the company before its first trading day as part of the S&P 500. Shares closed up 67.25, or 23.95 percent, at a record 348. More than 66 million shares changed hands.
Yahoo's stock has enjoyed a strong run since last week's announcement that it would be added to the S&P 500. The company, which has a market capitalization of $56 billion, replaces Canada's Laidlaw, the largest school bus company in North America.
Companies that join a large index usually see their share prices rise because index fund managers must buy the stocks to match the index's performance.
Last Friday, the S&P 500 and the tech-heavy Nasdaq composite index closed at record highs. The S&P 500 added 24.26 points, or 1.7 percent, to close at 1,433.3.