Investment bank Morgan Stanley shook up the market for Chinese e-commerce stocks Thursday evening, downgrading (NYSE: BABA) in a research report on the industry, cutting its price target on JD.com (NASDAQ: JD), but naming PDD Holdings (NASDAQ: PDD) its top pick in the sector. Despite the bank having different opinions on the three different stocks, however, investors seem to have read only the negatives in Morgan Stanley's note -- and are selling shares in all three companies.

As of 10:55 a.m. ET, Alibaba shares are down 2.9%, while both JD.com and PDD Holdings are off 1.9%.

The uniformly negative reaction to Morgan Stanley's news may be owing to the tone set in the bank's discussion of the best known of these three stocks, Alibaba. As StreetInsider.com explains, MS removed its overweight rating from China's biggest e-commerce stock and replaced it with an equal-weight rating -- and a lower, $90 price target.

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Source Fool.com