Alibaba's post-dream-start era

Brokers and Chinese business people filled the floor of the New York Stock Exchange. It was to become the biggest IPO in the 222-year history of the NYSE. Following months of careful preparations, IT giant Alibaba's shares were to be traded publicly for the first time. It was a big thing for all those present. And it meant a lot of pressure for the NYSE operators who had to ensure a flawless start of trading activities.

The crowd would be around for a quite a while, long after Alibaba clients - rather than company founder Jack Ma - rang the opening bell. After all, Jack Ma acted according to his principle: "When my customers are happy, then so am I."

Computers and Wall Street officials took more than two and a half hours to adjust supply and demand. Trading continued on Monday, with 48 million additional shares sold at the NYSE. With some $25 billion generated, Alibaba thus easily eclipsed Facebook which generated $16 billion, and even beat the long-time record holder, the Agricultural Bank of China ($22.1 billion).

Jack Ma leaves floor with a bright smile

Three minutes after high noon on Friday, trading finally kicked off. The first shares were reported to have been traded at $92.7 (72.1 euros). After that, the stock skyrocketed, approaching the $100 threshold. At the end of the trading day, shares were sold for almost $94 apiece, marking a 36-percent rise compared to the issuing price. This was what you would call a dream start.

Jack Ma himself did not really experience that historic moment. He had left half an hour before trading ended, with a bright smile on his face as he walked out.

"What we received today was not money," Ma told CNBC television. "We received trust from our investors."

IPO tested three times over

In fact, the first minutes of an IPO can be decisive. Just think of the technical glitches accompanying Facebook's IPO two years ago when shares plummeted in the process. Until today, Facebook's stock image is still somewhat marred although the share value has almost doubled since then. And it certainly also dented the reputation of Nasdaq which was in charge of the Facebook listing.

The NYSE tried to capitalize on the rival's blunder. Its president, Tom Farley, said the stock exchange was dealing with the matter with well-dosed self-confidence. According to media reports, the IPO had been simulated three times before the real listing.

Aite Group analyst David Weiss argued the Facebook IPO disaster on Nasdaq was still very much on people's minds. "They're going to be extra careful," he told Businessweek.

Now we all know that Alibaba's IPO was a huge success for Farley who had climbed into the hot seat at the NYSE only four months ago. Trading in Alibaba shares will ensure his stock exchange million in listing fees over time. But what is even more important is the "we-can-do-better-than-Nasdaq" feeling, with the two rivals always vying for big tech IPOs with a view to securing big trade volumes and attention.

Any alleged downsides of the Alibaba shares have been sidelined, at least for the time being. Analysts had criticized Jack Ma's powerful position by virtue of Alibaba's corporate structure.

But stock market observer Jon Najarian sees no big difference to Facebook where Mark Zuckerberg holds a powerful position too, owning a big chunk of shares. And Google, he says, even split shares in two categories so as to strengthen the rights of the company founders. Najarian argues that this alone would not make buying those shares a bad investment.

Crammed IPO calendar a blessing for stock trading

Hardly anyone sees the Alibaba stock taking a deep dive over the next few weeks after its excellent start. CNBC anchor Jim Cramer says the rise of the Chinese firm is a "typical American success story." Former English teacher Jack Ma founded Alibaba in a one-room apartment 15 years ago. Now, he says, the company is worth some $200 billion. Only, Kramer adds, it's not about an American company at all, unfortunately.

The Wall Street Journal wrote in a commentary that the IPO has been good advertisement for the stock market as a whole. And Jerry Braakman from First American Trusts adds it is good to have a crammed IPO calendar. He says the enormous Alibaba share demand is an indicator of a bullish market, with a lot going for owning shares anyway. The broad S&P500 index for instance rose by 8 percent last year. And thanks to Alibaba, overall IPO volumes of last year have already been exceeded with $69 billion coming in so far.

The all-time IPO income record dates back to the year 2000 when some $105 billion were generated mainly through tech listings. What followed was the burst of the dotcom bubble. But the majority of Wall Street observers believe a similar scenario this time around is out of the question.

But even if it happened - Jack Ma can fall back on his credo: "Never give up. If you've got a hard day today, tomorrow may be even worse. But after that, the sun will shine again."