SAN FRANCISCO: Anthropic releases legal workflow plugins for its Claude Cowork AI assistant, sparking a $285 billion market capitalization wipeout across software, legal technology and professional services sectors as investors flee companies vulnerable to AI automation.
The legal plugin launched Friday enables Claude to review contracts, flag compliance risks, triage nondisclosure agreements and generate templated legal responses without requiring coding expertise from end users.
RELX and Wolters Kluwer each plunged over 10 percent on Tuesday while Thomson Reuters, LegalZoom and London Stock Exchange Group dropped between 6.5 and 10 percent. A Goldman Sachs basket tracking US software stocks sank 6 percent, its steepest single-day decline since April’s tariff-driven selloff.
The Nasdaq 100 fell as much as 2.4 percent before recovering to close down 1.6 percent. Traders dubbed the panic a SaaSpocalypse, describing sell-at-any-cost behavior as investors reassess AI as replacement rather than complement to existing software platforms.
Anthropic released 11 open-source plugins spanning sales, finance, data analysis, marketing and customer support alongside the legal toolkit. The plugins transform Claude from conversational assistant into specialized domain expert capable of executing multi-step workflows across business functions.
Industry analysts note the legal plugin consists primarily of structured prompts and workflow instructions rather than proprietary fine-tuned models, yet its release crystallizes investor fears around AI agents automating knowledge work previously requiring human specialists.
The broader selloff extends beyond legal software to encompass Indian IT services firms whose full-time-equivalent billing models face existential pressure as AI automates human-led project work traditionally charged by headcount.
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