COMMODITIES trader Glencore's shares were stuck under water on their first day of official trade, dashing hopes of a strong start after it set a mid-range flotation price for London's largest-ever offering.
Sources close to the matter had said Glencore, the world's largest diversified commodities trader, felt it had left "money on the table" with an offer price of 530p that valued the company at £36.7bn (€42bn).
The shares, however, dropped on the grey market after the offer price was set on Thursday, touching lows of 506p on Monday, when miners were battered by worries over Chinese demand and threats to a European recovery.
By the close yesterday, the first day of unconditional trading, the shares were changing hands at 525p, up 2.1pc.
The shares begin trading in Hong Kong today.
While some analysts still expressed concern over Glencore's valuation, several brushed aside worries about the stock trading below the offer price.
They said the market debut should be seen as a success, given its size and uncertainty in both commodity and equity markets.
Analysts at Numis in London said the listing showed "confidence in a robust long-term commodity story".
"It has performed in line with the market. The interesting bit will come when they release their earnings, because their growth forecasts for this year were aggressive for the mining division," analyst Andrei Kroupnik at Collins Stewart said.
Glencore is due to publish its results for the first quarter of the year by next month.
"Ultimately, it has only been a few days. Markets are volatile and commodities are still mostly going down."
Glencore will join the FTSE blue chip index today, further boosting a basic resources sector that already makes up around 15pc of the index, second only to oil and gas. (Reuters)