Citigroup and General Motors were ejected from the Dow Jones industrial average after both groups' dramatic falls from grace amid the financial crisis.

Travelers, the insurer that was once a division of Citicorp, will take Citigroup's place after the bank was forced to accept billion of dollars in US taxpayer money to stay afloat.

Cisco Systems, the technology group, will replace GM, which is leaving the high-profile index after filing for bankruptcy yesterday. The decision to remove GM ends the carmaker's 83-year run as an index member.

The index is overseen by the editors of The Wall Street Journal, owned by Dow Jones, rather than being decided by a company's market value, as with the FTSE 100, which is to unveil its quarterly reshuffle.

Changes to the Dow, which is one of the most-used indicators of how US stocks are performing, even though it consists of only 30 companies, are rare. However, AIG was ejected last September and replaced by Kraft, the food group, after the insurer was bailed out by the US taxpayer. The latest changes take effect on June 8.

Robert Thomson, the Journal's managing editor and Dow Jones Editor-in-Chief, said: “The parlous state of GM has left us with no choice but to remove it from the Dow. A bankruptcy filing immediately disqualifies a stock, regardless of a company's history or its role as a cultural icon.”

He said that he had been reluctant to remove Citigroup at the height of the financial frenzy, but it was clear that the bank was undergoing restructuring that would see the US Government holding a large, continuing stake.

Inclusion of Travelers is intended to bulk up the financial industry's representation in the index.

The FTSE 100 reshuffle will be based on closing prices on 9th June. Whitbread, the leisure group, and Friends Provident, the insurer, look likely to leave the index, with Wolseley, the plumbing group, and 3i, the private equity group, set to replace them.

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