Shares of data analytics software company Palantir Technologies, Inc. (NYSE:PLTR) declined in premarket trading on Monday, while AI-server manufacturer Super Micro Computer, Inc. (NASDAQ:SMCI) surged.

This divergent movement stems from the contrasting outcomes of these two companies in the latest quarterly rebalancing of key S&P indices, announced on Friday.

To the disappointment of Palantir investors, S&P Dow Jones Indices, a division of S&P Global, excluded Palantir from the S&P 500 Index but included Super Micro Computer and footwear designer and distributor Deckers Outdoor Corp. (NYSE:DECK). The changes will take effect on March 18.

Inclusion in the S&P 500 typically benefits stocks as index funds holding portfolios that mirror the index are obligated to buy them to maintain the weightings of the constituent stocks. Additionally, the increased trading volume and liquidity due to purchases by index funds and ETFs further bolster the stock’s value.

Reflecting these factors, Palantir’s premarket price dropped 4.13% to $23.90, while Super Micro Computer jumped 11.87% to $1,012.99, according to Benzinga Pro data.

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