End of sales moratorium jolts Facebook

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NEW YORK, Aug. 16 (UPI) -- The end of a moratorium on the sale of Facebook shares has been met with lower stock prices for the U.S. Internet giant.

Facebook shares have struggled since day one of Facebook's initial public offering, when technical glitches on the Nasdaq index made it difficult, temporarily, for traders to confirm purchases.

In early trading Thursday, share prices slid to $19.69 per share, almost half their original price and a low for the stock. By the close of trading Thursday, Facebook had regained some lost ground, closing at $19.87 per share, but still off $1.33 on the day.

The company's public debut May 18 began with a share price of $38 per share, with demand pushing prices higher, briefly. But slower-than-expected revenue growth reported by Facebook, concern over the company's ability to profit in an increasingly mobile digital environment and other difficulties quickly began eroding share values.

Some of the firm's early investors, including Facebook Chief Executive Officer and founder Mark Zuckerberg, sold shares during the public debut. But shares then went into what is called a lockup period and were made unavailable for sale, The New York Times reported Thursday.

Of the company's 421 million shares, 271 million were made available for sale Thursday. Sales moratoriums on the rest of the shares will end over time. A large number of shares will become available for sale in November, the Times reported.

As of Thursday, shares owned by big investors, like Accel Partners and Goldman Sachs, who bought into the company before it went public, were available for sale, but it was unclear whether these investors would put their shares on the market.

"All the lockup is doing is enabling people to sell. The issue is still confidence in Facebook's transition from the PC to mobile," market analyst Richard Greenfield of the brokerage firm BTIG told the Times.