Reddit surges on S&P 500 inclusion, set to replace AvalonBay

Reddit shares jumped more than 11% after S&P Dow Jones Indices announced the company will be added to the S&P 500, replacing AvalonBay Communities effective before the open on August 18. The move is expected to trigger substantial passive buying, with J.P. Morgan estimating index funds tracking the benchmark will need to buy 16.7 million Reddit shares, nearly three times its average daily volume of 5.98 million shares. Reddit was trading at $175.69, with more than $201 million in shares changing hands by 9:32 a.m. ET. The stock remains down more than 31% year to date and more than 42% below its September 2025 all-time high. The inclusion underscores a major index milestone for Reddit, while AvalonBay exits due to its planned all-stock merger with Equity Residential.