Shares of computing and tech giant International Business Machines (IBM) saw their steepest daily drop ​in more than 25 years on Monday, after AI ⁠startup Anthropic said ⁠its Claude Code tool could be used to modernize a ​programming language run on ​IBM systems.

IBM ⁠shares sank 13.2%, their biggest drop since Oct. 18, 2000.

COBOL is a programming language widely used on IBM mainframes across banking, insurance and government systems.

"Modernizing a COBOL system once required armies of consultants spending years mapping workflows. Tools like Claude Code ⁠can ⁠automate the exploration and analysis phases that consume most of the effort in COBOL modernization," Anthropic said in a blog post on Monday.

"With AI, teams can modernize their COBOL codebase in quarters instead of ⁠years," it added.

Software stocks have been battered in recent months by market fears around ​the growing capabilities of AI tools, particularly ​following the launch of plug-ins from Anthropic's large language model ⁠Claude, ‌seen ‌as the startup's push ⁠to become an application ‌layer.

Shares of cybersecurity companies, including CrowdStrike and ​Datadog, also slumped ⁠on Monday, as investors weighed ⁠the potential impact of Anthropic's new security ⁠tool ​on the industry.