FTSE 100 gives Dixons the boot

Stock exchange review excludes retail group, but fails to add the index's first IT company.

Dixons Group has lost the right to call itself a blue chip companyindex's first IT company. after being ejected from the Financial Times Stock Exchange (FTSE) 100 index.

The ejection for Dixons comes at the same time as Misys, touted as a likely candidate to be the first IT company to enter the index, narrowly missed being included.

The FTSE index committee has confirmed that Dixons will no longer be part of the FTSE 100 as of 23 March. The move was taken following Dixons' ranking of 121 by market capitalisation - below the cut-off point of 110.

Steve Brazier, associate director at analyst firm Dataquest, said: 'Not being in the FTSE 100 means unit trusts will not be investing in it. Dixons was late to react to the aggressive price war with Tiny Computers which took place over Christmas, but it could bounce back.'

Misys narrowly failed to be the first IT company to enter the FTSE 100.

The software and services company was ranked 92nd, only two places short of inclusion.

Independent analyst Richard Holway said: 'It's a shame. Misys recently went up something like 112p in one day. It is only a matter of time. This industry of ours is now mature enough, it is a major employer and exporter, and I feel that it is about time we got some recognition. The establishment of the IT index was long overdue. I'm sure Misys will be included in the next review.'

Dixons will be replaced by the contract caterers Compass Group. Dixons' shares fell 11 pence to 478p and Misys shares climbed 47.5p to 2,775p on 13 March.

Dixons was unavailable for comment.