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Block Surges on S&P 500 Inclusion: ETFs in Focus

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Shares of Block Inc. (XYZ - Free Report) jumped over 8.5% in extended trading on July 18, 2025, following news that the fintech company will join the S&P 500 index, replacing Hess. The addition becomes effective before the opening bell on July 23, according to a statement from S&P Dow Jones Indices.

Recent Changes to the S&P 500

This marks the second alteration to the benchmark index last week. Earlier, ad-tech firm The Trade Desk was added to the S&P 500, taking the place of software company Ansys. The latter was acquired by Synopsys in a deal that concluded on Thursday.

Hess exited the index following Chevron’s successful $54 billion acquisition of the oil producer, beating Exxon Mobil in a legal dispute over valuable offshore assets in Guyana.

Why Index Additions Boost Stocks

Companies that join the S&P 500 typically experience a stock price boost. This is largely due to fund managers and index-tracking ETFs rebalancing their holdings to include the new entrant. While most changes happen during the S&P’s quarterly rebalancing, off-cycle adjustments occur in cases of mergers and acquisitions. For instance, Datadog recently replaced Juniper Networks as part of a scheduled quarterly shuffle.

Tech Sector Gains Another Member

Block’s addition further strengthens the tech presence within the S&P 500. Originally known as Square, the company gained widespread adoption through its payment terminals and later diversified into crypto, lending and broader financial services. The company rebranded to Block in 2021 to signal a stronger commitment to blockchain technologies.

Performance and Market Position

Block’s stock remains down 16% year to date, lagging the broader market. Note that the Nasdaq has climbed over 8%, while the S&P 500 has risen 7%. However, the stock has surged 14.5% over the past month. However, with a market capitalization around $45 billion, Block still ranks well above the median company in the index.

ETFs in Focus

Against this backdrop, investors can bet on exchange-traded funds (ETFs) like Twin Oak Endure ETF (SPYA - Free Report) , VanEck Digital Transformation ETF (DAPP - Free Report) , Amplify Digital Payments ETF (IPAY - Free Report) , Fidelity Disruptive Finance ETF (FDFF - Free Report) and iShares FinTech Active ETF (BPAY - Free Report) . These ETFs are heavy on Block. The ETF SPYA invests about 7% weight in Block shares, while other ETFs invest in the range of 4% to 6% in Block shares. 

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