Shares in Alibaba went up by 38 per cent during its stock market debut yesterday, leading the biggest IPO in US history.
The Chinese e-commerce giant started trading on Friday under the ticker "BABA" on the New York Stock Exchange.
Shares were so popular that the price had to be revised up eight times from their initial value of $68. Shortly before midday they had reached $92.70, peaking at $99.70 later in the afternoon. They closed at $93.89 – up 38 per cent from the start of the day.
“This is the largest IPO in the history of the world and we have definitely watched history in the making today,” said Peter Garnry, Head of Equity Strategy at Saxo Bank.
The pricing of the IPO on Thursday initially raised $21.8bn (£13.38bn) for Alibaba. This was significantly higher than the $14bn anticipated by the company’s founder, Jack Ma. Around 271m shares were traded – more than double the number traded during the stock market debuts of Twitter or Facebook.
The result marks an e-commerce win for China: Alibaba had a market value of $231bn when markets closed, exceeding the combined market capitalisation of Amazon and eBay, the two leading US e-commerce companies.
"This is the most anticipated event I’ve ever seen in my 20-year career on the floor of the NYSE," said Mark Otto, partner with J. Streicher & Co.
"I think today’s move is sustainable: The company is profitable, unlike some of its competitors, and it is a way for traders to tap into the Chinese growth story."