Sep. 19--For all the hand-wringing about corporate headquarters leaving Chicago, the ascension Thursday of Kraft Foods Inc. to the Dow Jones industrial average appears to mark the first time Illinois has been home base to four companies in the famous stock gauge.

The dramatic implosion of American International Group Inc. led the keepers of the Dow to replace the insurer with Northfield-based Kraft, the nation's largest processed food-maker and producer of everything from Oscar Mayer meats to Oreo cookies.

The 112-year-old Dow industrials consist of 30 stocks chosen by The Wall Street Journal's top editor. While changes tend to occur every few years, they usually reflect broad, long-term economic trends, with technology, entertainment and service companies replacing older industrial firms over the years.

Not this time. In testimony to the breadth of Wall Street's meltdown, Journal Managing Editor Robert Thomson refrained from replacing AIG with another financial stock "because of the extremely unsettled conditions," according to a Dow Jones statement.

"We realize this decision leaves the Dow Jones industrial average underweighted in financials, and we will address this situation in due course," Thomson said in the release. AIG had been in the average since 2004.

Kraft got the nod because the Dow had no representation in food products, and Kraft is one of the world's leading food firms, Thomson said. Coca-Cola Co. is in the Dow, but its focus is beverages. The switch to Kraft will go into effect Monday.

So, was there celebrating at Kraft on Thursday? "We're not necessarily having a party, but it certainly is a great affirmation of our leadership in the food sector," said Kraft spokesman Mike Mitchell.

"Our products are prevalent in more than 99 percent of U.S. households, so we think it's only natural that we're in the cupboard of leading stocks," he said.

On the Dow, Kraft will join Oak Brook-based McDonald's Corp., Peoria-based Caterpillar Inc. and Chicago-based Boeing Co. McDonald's is the oldest member of the club from Illinois, joining in 1985. Boeing, which moved its headquarters to Chicago in 2001, made it in 1987. Caterpillar was added in 1991. All have outperformed the Dow overall since joining.

For decades, the Dow has usually sported two or three Illinois-based companies. Sears and International Harvester, now known as Navistar, had the longest tenures; the former was a 75-year Dow denizen until being booted in 1999, the latter had a 66-year run through mid-1991.

The Dow Jones industrial average debuted in 1896 with 12 companies, including Chicago Gas, the predecessor to Peoples Gas, which is now part of Chicago-based Integrys Energy Group Inc. By the late 1920s, the index had expanded to 30 firms.

Today, there are broader stock indexes that better represent the economy, namely the Standard & Poor's 500 index of large stocks and the Russell 2000 index of smaller companies, said Bob Korajczyk, a professor at Northwestern University's Kellogg School of Management.

Still, the Dow manages to correlate well with those broader indexes, he said.

Kraft's shares added $1.09, to $33.74, up 3.3 percent, compared with a 3.9 percent rise for the Dow as a whole.

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