Read Why China's Regulators Summoned Alibaba, Baidu

China's cyberspace administration and police have summoned the cloud units of Alibaba Group Holding Ltd BABA and Baidu Inc BIDU for better telecom fraud prevention policies, Reuters reports.
The Ministry of Industry and Information Technology stated via Weibo Corp WB that Alibaba and Baidu's cloud platforms allow access to fraudulent websites.
China was building its state-backed cloud system as it announced a crackdown on telecom and internet fraud.
Alibaba has suffered a colossal dent in its market cap following a countrywide regulatory crackdown.
Alibaba and Baidu need to "earnestly fulfill their main responsibilities for network and information security," the industry ministry statement said.
Related Content: Chinese Regulators At It Again: Tech Stalwarts Including Alibaba, Tencent And Baidu Fined $3.4M For Violating Antitrust Regulations
Analyst Rating: Needham analyst Vincent Yu maintained Alibaba with a Buy and lowered the price target from $330 to $230, implying a 70.1% upside.
Price Action: BABA shares traded lower by 2.17% at $133.65 on the last check Tuesday.