Shares of China’s top e‑commerce players fell Thursday after Beijing’s market regulator summoned Alibaba, JD.com, Pinduoduo, Douyin and Xiaohongshu over alleged false advertising ahead of the 6.18 shopping festival. Alibaba slid 5.4%, while JD.com dropped 2.9%, reflecting investor nerves about tighter oversight of online sales tactics.

The regulator cited “irregularities” such as undisclosed subsidies, noting that Taobao, Pinduoduo and JD.com each pledged 10bn yuan in promotions but failed to reveal actual discount spend or merchant contributions. Douyin and Xiaohongshu also omitted key promotion data, prompting concerns that aggressive price wars distort market pricing and burden merchants.

Analysts at Jefferies highlighted that Alibaba’s stock has already lost nearly a quarter of its value this year, compounded by worries over its cloud unit and potential price cuts from AI rivals. The crackdown underscores Beijing’s broader effort to curb “involution” in e‑commerce, signaling that firms must tighten subsidy reporting or face continued share pressure.