NEW YORK (Reuters) -- General Motors Co. shares finished their first day on the New York Stock Exchange up by 3.6 percent amid heavy volume, closing at $34.19 -- a gain of $1.19 over its initial stock offering price of $33 a share.
GM, which helped pace a 173-point gain on the Dow Jones industrial average, made a dramatic return to public stock markets less than a year and half after it emerged from a government-funded bankruptcy.
Trading started at $35 and rose as high as $35.99 in early trading. The price declined gradually during the day during heavy trading volume -- more than 452 million shares traded hands.
Obama administration officials said the strong market debut for GM showed they made the right choice in restructuring GM with $50 billion in financing since 2008.
"The American auto industry, the proud symbol of American manufacturing might for more than a century, is once again on the rise," President Barack Obama said during a late afternoon press conference at the White House.
"For the first time in six years, Ford, GM and Chrysler are all operating at a profit."
At 9:30 a.m., GM shares began trading on the New York and Toronto stock exchanges with the rev of a Camaro engine on the floor of the New York Stock Exchange taking the place of the traditional ringing of the bell.
The start of trading in GM shares represented the last step in a blockbuster initial public offering negotiated by the Obama administration that raised $20.1 billion after pricing the automaker's shares at $33 each.
The IPO capped the first stage of a turnaround that has taken the 102-year-old automaker from near-death in 2008, via a 2009 bailout, to unlikely Wall Street flotation favorite in 2010.
"This is a bit better than people had been projecting. As to a year ago. it's not even in the same ballpark," Ron Bloom, the U.S. Treasury official in charge of the GM investment told Reuters Insider. "A year ago, people said 'you have no exit, you have no strategy. This company is not fixed.'"
The GM rescue left the Treasury with a 61 percent stake and the automaker with the embarrassing nickname "Government Motors." After the IPO, the U.S. government stake could drop to 33 percent.
The IPO values GM at about $63 billion. Including an option that would allow underwriters to sell more shares, GM looks set to raise $23.1 billion, eclipsing the record $22.1 billion raised by Agricultural Bank of China in July.
GM, according to several reports today, will use the over-allotment of shares.
The team of GM executives led by CEO Dan Akerson that pitched the IPO to investors said they recognized their job in transforming GM was not done.
"We have to celebrate on the run here," GM North America President Mark Reuss told Reuters. "It's a big day to become a public company again but we have got to just hit the ball out of the park here every day on product."