Jack Dorsey's Block is joining the S&P 500, stock surges by 10%

Block is getting bumped up to the S&P 500, and investors are not wasting time reacting. On Friday, shares of the company jumped more than 10% after hours, according to S&P Global, which announced that Block will replace Hess in the index starting before the opening bell on July 23.

The shake-up follows Chevron’s $54 billion acquisition of Hess, completed after the oil giant came out on top in a legal fight with Exxon Mobil over drilling rights in Guyana.

The change is one of two this week. On Monday, S&P Global also confirmed The Trade Desk will take over Ansys’ place after Synopsys closed its deal to acquire the software firm on Thursday. While most of these index swaps happen during regular quarterly rebalancing, mergers like this one fast-track the process. Last week, Datadog moved into the index to fill the spot left by Juniper Networks.

Block takes the seat, tech gets bigger

This latest move gives the index more tech weight, continuing a trend that’s been building for years. Block, which used to be called Square, was launched by Jack Dorsey in 2009. The company made a name for itself with sleek payment terminals before branching out into crypto, lending, and broader financial services. It rebranded as Block in 2021 to match its growing interest in blockchain infrastructure.

Block’s rise into the S&P 500 puts it above many of its peers in terms of valuation. Even though its stock has dropped 14% this year, it still holds a market cap of around $45 billion, which is well above the median for companies in the index. For context, the Nasdaq is up over 8% this year, and the S&P 500 itself has gained about 7%, meaning Block’s underperformance hasn’t stopped it from climbing into the top tier.

The stock jump didn’t come from better earnings or any new product drop. This is all about portfolio managers being forced to buy Block to track the S&P 500 exactly. When a company gets added to the index, massive funds have no choice but to load up. That buying pressure sent the price up instantly.

Still, things haven’t exactly been smooth for the company. In May, Block reported first-quarter results that missed expectations, and it followed up with a downbeat forecast for the second quarter and the full year. That guidance came with a warning about the overall U.S. economy, especially following tariff actions by President Donald Trump that tightened conditions for a lot of businesses.

“We recognize we are operating in a more dynamic macro environment, so we have reflected a more cautious stance on the macro outlook into our guidance for the rest of the year,” Block wrote in its latest quarterly filing.

The next major checkpoint for the company is coming fast. Block is scheduled to report second-quarter earnings on August 7, after markets close. Investors, already tied to the stock through index exposure, will be watching closely.

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