NEW YORK • Uber Technologies shares extended the free fall on Monday following a rocky debut last Friday after launching the biggest initial public offering (IPO) of the year.

The ride-hailing giant dropped as much as 11 per cent to US$37.08 in New York. Uber sold 180 million shares at US$45 apiece last Thursday, and on Friday it never traded above that price, ending the day down 7.6 per cent at US$41.57 even as other stocks gained.

The share slump reflects investor scepticism about the size of the ride-hailing market, Uber's ability to execute on food and package delivery, and its push into autonomous vehicles, said Mr Ygal Arounian of Wedbush Securities.

The IPO also comes as investors shy away from riskier assets given US-China trade tensions, said the analyst, who has an outperform rating on Uber and sees the stock reaching US$65 in the next year.

"Uber's highly anticipated IPO coming out of the gates on Friday was clearly not a 'storybook start'," Mr Arounian wrote in a note. Uber is a "prove-me situation and thus not going to be an overnight success story".

Ride-sharing peer Lyft fell in sympathy with Uber last Friday, extending its losses to 29 per cent since its March debut. That slide showed no sign of abating on Monday, with shares another 7.3 per cent lower to hit new record lows. Lyft had slumped as last week came to a close after its first set of results disappointed the market.

Uber must execute flawlessly over the next 12 to 18 months, and if it does, a market value of US$100 billion (S$137 billion) or more is possible, Mr Arounian said.

The firm should be able to morph its ride-sharing platform into "a broader consumer engine including food and freight delivery", he said. The company had a US$69.7 billion market value at last Friday's close.

Jitters in the broader market continued into Monday, with Asian stocks and European shares edging lower as the market awaits details on how China will retaliate against the US hiking tariffs.

BLOOMBERG