LONDON/NEW YORK - Streaming music leader Spotify appears to be bracing for a potentially rough stock market ride on its first day of trading on Tuesday, following Monday's steep sell-off of technology stocks on Wall Street.

In a public letter published ahead of its unorthodox listing in New York, Chief Executive Daniel Ek cautioned employees and fans that "Sometimes we succeed, sometimes we stumble" and "I have no doubt that there will be ups and downs."

Nonetheless, in informal trading on Monday, pricing for Spotify appeared to be holding up, changing hands at about US$132 a share, which would value the company at more than US$23 billion.

That also was the reference price identified late Monday by the New York Stock Exchange, which serves as an early estimate of the level at which supply and demand are balanced.

“They are assuming based on where it is trading in the grey market and what it appears right now as supply and demand, around US$132 should be a fair price,” an equity trader said on Tuesday.

In February, the shares were valued at about US$20 billion based on private stock transactions among existing investors.

"Nothing ever happens in a straight line — the past 10 years have certainly taught me that," Ek, the Swedish company's co-founder and CEO, wrote in a blog post on Monday evening.

HAVE YOUR SAY

Are you tempted to invest in Spotify as it makes its market debut?

Results

Total Results: 0

Since launching its streaming music service a decade ago, the Stockholm-founded company has overcome heavy initial resistance from big record labels and among some major music artists to transform how the industry makes money. Spotify offers access to vast libraries of music rather than making users pay for CDs or downloads of individual albums or tracks.

The company has structured the stock market listing to allow existing investors to sell directly to the public while offering no shares of its own, in a test case being closely watched by other well-funded multibillion-dollar tech firms with no immediate cash-raising needs.

By foregoing hiring investment banks as underwriters or holding traditional promotional events with institutional investors, this could lead to extreme trading volatility when formal trading begins, analysts say.

The opening public price will be determined by buy and sell orders collected by the NYSE from broker-dealers, the exchange said.

Based on those orders, the opening price will be set based on a designated market maker's determination of where buy orders can be matched with sell orders at a single price.

While Ek eschews New York Stock Exchange rituals such as opening bell-ringing and trading floor interviews to tout the stock, the front of the 115-year-old Greek Revival exchange building has been draped in a vast green-and-black Spotify banner.

Global recorded music industry revenue in 2014 had fallen by 40 percent to $14.3 billion from $23.8 billion in 1999, when the rise of music file-sharing service Napster ravaged sales of CDs. The industry has returned to growth since 2015 driven by streaming service revenue, which now accounts for 60 percent of recorded music sales, according to market estimates.