China's JD.com announces $5 billion share buyback plan

(Reuters) -JD.com said on Tuesday its board has approved a new $5 billion share repurchase program, effective September, allowing the Chinese e-commerce giant to buy back its stock over the next 36 months.

U.S.-listed shares of the company jumped 5.1% in premarket trading.

JD.com, which last week beat profit forecasts for the June quarter, and rivals such as Alibaba, have been seeking to alleviate investor concerns over the sluggish Chinese retail market through major share buybacks.

This marks JD.com's second share buyback announcement this year, after announcing a $3 billion repurchase in March. Alibaba announced a $25 billion share buyback in February.

Chinese consumers have been shy to spend in the face of a macroeconomic slowdown, an extended property slump and employment security concerns, prompting JD.Com to offer regular discounts and promotions.

All of China's major e-commerce retailers have been engaged in a cut-throat competition for market share in the world's largest e-commerce market.

News on Monday that rival PDD Holdings - which operates discount retailers Pinduoduo in China and Temu for the international market - had missed revenue expectations and was warning of an uncertain landscape wiped $55 billion from its market cap.

U.S. listed shares of JD.com and Alibaba were dragged down with it.

Earlier this month, big-box retailer Walmart sold its entire roughly $3.7 billion stake in JD.com, ending an eight-year investment in the company to focus on its own China businesses, though the move also prompted questions as to how well placed JD.com is to succeed in the current environment.

(Reporting by Deborah Sophia in Bengaluru and Casey Hall in Shanghai; Editing by Shilpi Majumdar and Sharon Singleton)

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