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Facebook's IPO may dampen confidence in future IPOs, survey says

June 26, 2012|By Andrew Tangel
  • Facebook's May 18 debut on public markets was fraught with problems from the start. The Nasdaq Stock Market, where Facebook is listed, delayed the IPO for two hours.
Facebook's May 18 debut on public markets was fraught with problems… (Carolyn Cole / Los Angeles…)

NEW YORK -- The market for initial public offerings may feel the effect of Facebook's botched IPO for months, a survey found.

Of respondents to the survey by the Tabb Group, a Wall Street consulting and research firm, 46% said the market for IPOs would feel the effect for six months, while 39% believed the market could be slowed for a year or two.

Of respondents to the survey by the Tabb Group, a Wall Street consulting and research firm, 46% said the market for initial public offerings would feel the effect for six months, while 39% believed the market could be slowed for a year or two.

In Tabb's survey, 59% of respondents said they would be more cautious about participating in the next "headline IPO."

Facebook's May 18 debut on public markets was fraught with problems from the start. The Nasdaq Stock Market, where Facebook is listed, delayed the IPO for two hours.

Investors faced widespread confusion over whether trades had been executed. Then the stock ended its first day where it began -- slightly above its initial price of $38 -- disappointing retail investors hoping to cash in on the much hyped IPO.

Facebook's stock fell sharply in the weeks following its IPO, but has rebounded since then. On Tuesday, the stock gained $1.04, or 3.2%, closing at $33.10 a share.

Tabb said its "IPO Survey Industry Barometer" included responses from 175 financial industry participants, including investment managers, hedge funds, brokers, exchanges and alternative trading systems.

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