Gets Rousing Welcome

Chinese search provider , dubbed the “Google of China,” became the hottest IPO in more than five years Friday, soaring 354% in its Wall Street debut.

Perhaps Google should strive to become the Baidu of the United States. It’s taken a year for Google to add 244% to its August 2004 IPO price of $85. Baidu passed that milestone in a few hours and kept going, ending the day at $122.54, $95 higher than its $27 IPO price.

The company raised both the terms and the price of the IPO because of demand from investors, and even then, the 4 million-share offering opened at $66 when it began trading on the Nasdaq stock market and doubled from there, reaching a high of $151.21 before pulling back.

By the end of the day, the company was valued at about $4 billion — more than 100 times sales and about 300 times cash flow, a valuation that dwarfs both Google and Yahoo . But with a 200% growth rate and a commanding presence in the fast-growing Chinese Internet market, investors flocked to the IPO, trading nearly six times the number of available shares on the day.

Google fared well in Baidu’s debut — the company owns a 2.6% stake in its Chinese rival, and there were also reports that Google tried to buy Baidu before it went public. Also faring well in the offering was Silicon Valley venture capital firm Draper Fisher Jurvetson, which has a 28% stake in Baidu.

The broader market fell after a stronger than expected July jobs report suggested that there is no end in sight to Federal Reserve interest rate hikes. The Fed is expected to raise rates again on Tuesday, and Cisco will report earnings after the close that day.

The Nasdaq lost 13 to 2177, the S&P dropped 9 to 1226, and the Dow fell 52 to 10,558. Volume declined to 1.9 billion shares on the NYSE, and 1.52 billion on the Nasdaq. Decliners led 25-7 on the NYSE, and 20-9 on the Nasdaq. Downside volume was 79% on the NYSE, and 68% on the Nasdaq. New highs-new lows were 80-35 on the NYSE, and 68-31 on the Nasdaq.

Computer Sciences lost 4% after beating estimates but issuing lukewarm guidance, and Network Appliance fell 3.7% after warning of an earnings shortfall.

WebMD fell 5% after reporting a 5-cent profit and a name change to “Emdeon.”

Homestore soared 40% on its results, while Audible , Ctrip and Openwave fell on their earnings reports.

Microsoft continued to gain on hopes for a higher dividend.

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