Investing.com -- Microsoft Corporation (NASDAQ: MSFT) fell 2.6% Tuesday as the broader software sector came under pressure.

The iShares Expanded Tech-Software Sector ETF dropped 4%, with Palantir Technologies and Salesforce, the second and third largest holdings in the ETF, declining 5%. The weakness was attributed to developments in AI automation that could disrupt traditional software business models.

Anthropic announced Tuesday that its Claude AI assistant can now control computers to complete tasks, including opening apps, navigating browsers, and filling spreadsheets. The feature, available in Claude Cowork and Claude Code for macOS users, allows the AI to operate directly on users’ screens when no app connector exists.

The capability enables users to assign tasks from mobile devices and return to completed work on their computers. Users can also schedule recurring tasks, such as scanning email every morning or generating weekly reports. The feature is available to Pro and Max subscribers.

Separately, The Information reported that Amazon Web Services is developing AI agents to automate functions in sales, business development, and other groups where it recently laid off hundreds of employees. AWS has been building an AI agent that helps sales employees answer technical questions, handling work previously performed by thousands of technical specialists in areas like cybersecurity and server networking.

An AWS spokesperson confirmed the company is developing an agent that "aggregates specialist knowledge from across AWS," enabling employees to "focus on the most complex, high-value customer challenges."

The developments highlight growing concerns about AI automation’s potential impact on traditional software and services businesses, contributing to Tuesday’s sector-wide decline.