What Happened?
A number of stocks fell in the afternoon session after Anthropic unveiled its "Claude Mythos" AI model through Project Glasswing.
While select partners rallied, the broader sector fell as investors feared this frontier model, the most advanced AI currently available, could disrupt the entire industry. Mythos demonstrated a "generational leap" by autonomously identifying thousands of zero-day vulnerabilities, which are software flaws unknown to developers. This suggests traditional security software may struggle to defend against AI threats that find and exploit bugs faster than humans can patch them.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Identity Management company Okta (NASDAQ: OKTA) fell 3.4%. Is now the time to buy Okta? Access our full analysis report here, it’s free.
- Vulnerability Management company Rapid7 (NASDAQ: RPD) fell 6.7%. Is now the time to buy Rapid7? Access our full analysis report here, it’s free.
Zooming In On Rapid7 (RPD)
Rapid7’s shares are very volatile and have had 26 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 9 days ago when the stock gained 4.3% after sentiment improved as President Trump indicated that the US was engaged in serious, productive talks with Iran.
This potential de-escalation of Middle Eastern tensions provided a significant sigh of relief for global markets, which had been bracing for prolonged geopolitical instability and surging energy costs. Simultaneously, investors appeared to be buying the dip in high-quality SaaS stocks following the "SaaSpocalypse" correction that dominated the early months of 2026. This meant there was hope resilient cloud platforms would remain indispensable digital infrastructure.
Rapid7 is down 61.5% since the beginning of the year, and at $5.49 per share, it is trading 79.5% below its 52-week high of $26.74 from May 2025. Investors who bought $1,000 worth of Rapid7’s shares 5 years ago would now be looking at only $69.73.
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