Software stocks selloff deepens as anthropic plugins rattle legal and data analytics markets
Global markets reeled as new anthropic plugins for automation raised urgent questions about the future of premium software and data analytics services.
Claude Cowork launch sparks broad software rout
On Friday, Anthropic unveiled new Claude Cowork plug-ins designed to automate legal, sales, marketing, and data analysis work. These tasks have historically generated high-margin revenue for software and information providers. However, the launch triggered a sharp reassessment of business models built on expensive licenses and proprietary datasets.
The selloff accelerated on Tuesday, with software stocks losing more than $300 billion in market value in a single session. Moreover, the shock rippled across both North American and European markets as investors recalibrated expectations for long-term growth in knowledge-based services.
Anthropic’s Claude Cowork tools can now automate drafting, research, and analysis workflows that underpin many professional platforms. That said, analysts cautioned that markets may be pricing in worst-case scenarios before the practical impact of these tools is fully understood.
Thomson Reuters decline leads legal and professional services slump
Thomson Reuters, owner of the influential Westlaw legal database, led the rout with an 18% decline on Tuesday. The stock is on track for its biggest single-day loss on record. In addition, Thomson Reuters shares are now down 33% this year after already falling 22% in 2025, deepening concerns about its core legal franchise.
Mike Archibald of AGF Investments said Anthropic’s plug-ins represent a direct challenge to Thomson Reuters’ legal information and workflow solutions. However, he also stressed that markets tend to react quickly to perceived disruption, often before companies can articulate strategic responses or demonstrate resilience.
Thomson Reuters is scheduled to report its fourth quarter earnings on Thursday. Moreover, Morgan Stanley analysts noted that most investors they surveyed remain bearish on the group’s ability to sustain growth in its legal division amid rising data analytics competition.
European legal analytics disruption hits RELX and Wolters Kluwer
European legal and professional services providers suffered similar damage. RELX, the British legal analytics and information group, dropped 14% on Tuesday. The stock has now fallen almost 50% from its February 2024 peak, and this week’s slump marked its largest one-day decline since 1988.
Wolters Kluwer, the Dutch-based legal and professional services company, slid 13%. Other data and research names also sold off heavily, underlining market anxiety about legal analytics disruption and automated research tools that could compress pricing power over time.
FactSet Research dropped 10.5%, while Morningstar lost 9% as investors rotated away from data platforms. Moreover, LegalZoom plunged 19.7%, reflecting fears that AI-based document creation and legal guidance could erode its competitive position.
In London, shares of Experian, Sage Group, London Stock Exchange Group, and Pearson each fell between 6% and 12%. Jonathan McMullan at Schroders said episodes like this show how investor fear can temporarily overpower fundamental valuations when disruptive technology headlines emerge.
Tech giants dragged lower alongside sector indices
The selloff was not limited to niche analytics providers. Large U.S. technology stocks also came under pressure on Tuesday. Nvidia declined 2.8%, while Meta Platforms slipped 2.1%. Moreover, Microsoft lost 2.9% and Oracle dropped 3.4% as investors trimmed exposure to enterprise software and cloud-related names.
The broader market mirrored this risk-off tone. The Nasdaq Composite fell 1.43%, while the S&P 500 closed down 0.84% on the day. However, the moves were most acute in companies viewed as vulnerable to AI-driven automation of research, coding, and knowledge work.
For many portfolio managers, the question is less about immediate earnings damage and more about how quickly clients might experiment with new AI systems. That said, the speed and scale of Tuesday’s reaction suggests positioning in growth and information names was stretched going into the news.
Advertising sector pressure and AI-powered services pivot
Advertising and marketing groups also suffered steep declines as investors contemplated a shift toward ai powered services. In New York, Omnicom closed down 11.2%. French giant Publicis dropped more than 9% after releasing earnings and outlining a more aggressive AI strategy.
Publicis said it plans to spend 900 million euros on acquisitions in 2026, focusing on AI technologies and proprietary data assets. Moreover, the company emphasized that future growth will rely increasingly on automated media planning, personalization, and measurement, rather than purely traditional agency services.
Other advertising-dependent platforms also fell sharply. Pinterest ended the session down 5.6%, while Snap dropped 8.4%. Giuseppe Sersale of Anthilia said AI is rapidly taking over many programming and knowledge tasks that support these businesses, intensifying advertising sector pressure as models evolve.
How anthropic plugins reshape expectations for automation
Investors are now assessing whether the latest anthropic plugins signal a structural turning point for professional software and information providers. The new Claude Cowork capabilities, which streamline contract drafting, document review, and complex analysis, directly overlap with services long sold at premium price points.
Moreover, these developments have raised questions about pricing power, renewal rates, and competitive moats across legal, financial, and marketing platforms. While many incumbents are investing in their own AI tools, markets appear unconvinced that all players can adapt quickly enough to protect margins.
For now, the immediate impact is a broad repricing of expectations across legal databases, analytics suites, and creative agencies. However, in the coming quarters, earnings reports and product launches will determine whether Tuesday’s selloff marks an overreaction or an early signal of deeper structural change.
In summary, Anthropic’s Claude Cowork launch has ignited a sharp software and services reset, with investors rapidly reassessing which business models can withstand accelerating AI-driven automation across legal, data, and advertising markets.
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