Economy Briefs: Investors not viewing social media like tech

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NEW YORK — The lackluster stock market debut for Facebook suggests investors are not ready to jump in and create another tech bubble despite big expectations for social media, analysts say.

Facebook closed out its first full week of trade with a loss of 16 percent from its offering price of $38, in a huge disappointment after a much-hyped initial public offering worth $16 billion, the biggest for a tech firm.

The stock failed to live up to the anticipation of some who thought investors would be stampeding to get a piece of the network which has 900 million users.

“When you see Facebook share prices tank, it does get people back on to a more foundational basis, in terms of real revenues, real profits,” said Nick Landell-Mills at Indigo Equity Research.

Mark Heesen, president of the National Venture Capital Association, said investors are being more cautious than during the tech bubble of the late 1990s.

“This is by no means the end of social media. It is going to continue to grow and expand,” he said.

But he said that during the tech bubble, “Venture capitalists invested $150 billion in two years. In the last two years we invested about $60 billion. There is much, much less money in the system right now. That’s critically important.”

AUTOS

Hail storm pounds new Ford Escape models

A big hail storm last month pounded thousands of Ford’s popular new Escape SUVs as they awaited shipment to car dealerships. But the damage won’t slow the roll-out of the new model, a spokesman said.

The hail storm hit Louisville, Ky., on April 28 and damaged about 3,500 Escapes, according to a report in the (Louisville) Courier-Journal. The cars are assembled at a nearby plant.

Todd Nissen, a spokesman, said the cars were undergoing final quality checks when the storm hit. The damaged units won’t be sold to the public as new cars, he said.

Ford Motor Co. said earlier this month that it is ramping up production at the Louisville factory and 12 others to meet rising demand. Ford’s sales are up 5 percent this year.

CONNECTICUT

Late night blaze destroys bell factory

EAST HAMPTON — One of the oldest continuously operating factories in Connecticut that made bells was destroyed in a weekend fire.

The blaze at the Bevin Brothers Manufacturing Co. factory in East Hampton started at about 11:30 p.m. Saturday. More than 30 fire departments helped to bring it under control.

Bevin Brothers was the last of a once-thriving industry that earned East Hampton the nickname, “Belltown, USA.”

The Hartford Courant reports that the Connecticut Region 3 Incident Management Team said propane tanks in the factory caught fire and exploded, helping spread the blaze.

SWITZERLAND

Nation drafts eurozone collapse action plan

GENEVA — Switzerland does not foresee a breakup of the eurozone but is nonetheless drawing up an action plan in the event of its collapse, the country’s central bank chief said Sunday.

Thomas Jordan, who became chairman of the Swiss National Bank last month, told the SonntagsZeitung newspaper that a working group was discussing measures to combat any strengthening of the safe haven Swiss currency.

The bank intervened in September to stem the rise of the Swiss franc which had soared as investors sought a secure place for their cash, hurting Swiss exports and the tourism industry.

From wire dispatches and staff reports

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