REUTERS

SAN FRANCISCO

FACEBOOK shares rose less than expected on their first day of trade on Friday and huge order volume caused technical problems that marred the coming out party of the No 1 online social network.

Its shares were up 8 percent in early afternoon trading on the Nasdaq, after opening 11 percent higher and then rapidly heading south to touch their initial public offering price of $38.

The gains were below market forecasts of as much as a 50 percent jump.

“We have got some unhappy guys out there,” said Wayne Kaufman, chief market strategist at John Thomas Financial, a retail broker on Wall Street.

“They were hoping for Facebook to be considerably better. I bet there are a lot of disappointed people in the market.” Facebook, which has about 900 million users globally, priced its IPO at the top end of its target range, becoming the first US company to go public with a valuation greater than $100 billion. If a greenshoe option to underwriters is exercised, Facebook will raise as much as $18.4 billion by selling an 18 percent stake, the secondbiggest IPO in US history after the one by Visa.

Analysts blamed the poorerthan- expected first-day showing on the vast number of shares floated and market weakness. General Motors’ decision to pull paid-advertising from the social network, announced this week, also hurt.

After a delay in the opening print that drove up anxiety levels among traders and onlookers outside the Nasdaq, the closely watched stock began trading at $42.05, rose to as high as $45 and then rapidly retreated. The Nasdaq exchange said it was investigating an issue with execution of trades.

Facebook’s IPO had been heavily oversubscribed, particularly by retail investors, despite concerns about slowing growth in the last quarter, whether the company can make money from mobile advertising, and the immense control Chief Executive Mark Zuckerberg has over on the company.

Others warned that the IPO price, equivalent to over 100 times historical earnings versus Apple’s 14 times and Google’s 19 times, makes Facebook a risky bet.

For Facebook, Friday began with much fanfare. To rapturous applause from employees, Mark Zuckerberg — flanked by Chief Operating Officer Sheryl Sandberg and Nasdaq Chief Executive Robert Greifeld — rang the bell to kick off trading at the company’s Silicon Valley headquarters at 6.30 am Pacific time.

The 28-year-old billionaire founder, wearing his trademark black hoodie, hugged and highfived Sandberg and other employees in celebration after he pressed the remote button.

The area outside Facebook’s offices was packed with throngs of photographers, more than a dozen television trucks, and a TV news helicopter hovering overhead as the excitement reached fever pitch.