Investing.com -- Shares of China’s major food-delivery companies jumped after authorities stepped up efforts to rein in intense competition that has pressured profitability across the sector.

Meituan shares closed 14% higher in Hong Kong, Alibaba Group gained 4.6%, while JD.com rose 4.9%.

In the U.S., shares in Alibaba and JD jumped 4.6% and and 4.3% in premarket trading, respectively.

The rally followed a seminar held by China’s market regulator aimed at addressing unfair competition. The regulator’s website also reposted a column from the state-backed Economic Daily newspaper calling for an end to price wars in the industry.

The Economic Daily said the sector has entered a “vicious cycle” of sacrificing profitability to attract attention, which in turn weighs on broader consumption recovery. Such pricing battles run counter to government efforts to support consumption, it added.

Competition in the food-delivery space has intensified since JD.com signaled plans last year to enter the market and compete with Alibaba and Meituan. Since then, the companies have rolled out multiple rounds of subsidies to attract users to their platforms.

Meituan reported its largest annual loss since at least 2021 in February, citing the impact of heightened competition.

In February, JD.com announced it was entering the highly competitive market, adding catering merchants to its logistics platform.

The company said merchants that join JD Takeaway before May 1 would receive commission-free services for a full year. JD added the initiative is designed to provide comprehensive support to merchants and promote “healthy and sustainable development” of the sector.

As competition intensified amid weaker consumer spending, JD rolled out discount campaigns to attract users. The resulting price competition has weighed on its share price. The company is leveraging its self-operated logistics network, which enables same-day or next-day delivery across most regions in China.