Hong Kong-listed shares of Chinese online retailer JD.com climbed 1.2% on Wednesday, outperforming the decline on the Hang Seng index after the firm announced a $5 billion buyback late Tuesday.
U.S. listed shares of the firm rose 2.24% on Tuesday after the announcement. Both JD.com’s Hong Kong and U.S. shares have dropped about 20% year to date.
In comparison, Hong Kong’s benchmark Hang Seng index was down about 0.82% Wednesday, but is up about 4% for the year so far.
The announcement is JD.com’s second buyback this year, after announcing a $3 billion buyback in March.
In response to the move, Chelsey Tam, senior equity analyst at Morningstar, said that the decision to announce the share buyback is “not surprising.” She explained, “It is a common theme in China when share prices and growth are low.”
Tam also pointed to Vipshop, another Chinese e-commerce player that has increased its own share buyback program last week.
China’s e-commerce sector has been dogged by a slow domestic economy.
Earlier this month, Alibaba’s second-quarter results missed expectations on both the top and bottom lines. On Monday, Temu-owner Pinduoduo saw its worst ever session after its second-quarter results missed both revenue and earnings per share expectations.
Back in February, Alibaba announced a $25 billion share buyback after it missed revenue targets for the fourth quarter of 2023.