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article imageUber shares plunge further amid global stock market wobbles

By Tim Sandle     May 14, 2019 in Business
Uber suffered another significant drop in its share price, following its low-end IPO launch. The taxi company's performance came amid a global stock market fall, driven by tensions between the U.S. and China over trade.
Uber shares plunged further, following on from the ride-hailing firms heavy losses following its initial public on May 8, 2019. As Digital Journal reported, Uber experienced the biggest first-day dollar loss in U.S. IPO history. Based on May 13, 2019 data, Uber shares have fallen close to 11 percent in the wake of initial public offering cost investors billions. Uber shares closed at $37.10 per share in its second day of trading.
Uber's initial share price was on the lower end of the scale, at $45 per share. This gives Uber a market capitalization of $75.5 billion; well-down on the $125 billion estimated back in October 2018. One reason for this lower value relates to investor concerns that Uber has yet to come close to making a profit (Uber still subsidizes rides in most areas to get footholds in markets) and due to the risks that new technology presents, either in terms of Uber's future direction or the disruptive challenge from a new competitor.
READ MORE: Is Uber's IPO the worst-ever in stock market history?
Uber's performance appears to mirroring that of its smaller competitor Lyft, which has also seen a drop in its share price, with he company's valuation remaining far below its initial launch price. Lyft is currently trading 33 percent down from its initial share price.
Uber's woes occurred as the main U.S. and global markets came under pressure as investors attempt to interpret what the outcome of renewed trade tensions between the U.S. and China. The issue has been triggered by a new attempt by U.S. President Donald Trump to impose tariffs on U.S. imports, and counter-measures put in place by China. China plans to impose tariffs on $60 billion of US goods from 1 June, 2019.
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