Caterpillar Inc., the largest maker of construction and mining equipment, fell the most in almost two months on signs of a slowdown in mine investment and as manufacturing slowed in the U.S. and China.
The shares fell 3.6 percent to $82.28 at 12:55 p.m. in New York, the most intraday since July 10 and the biggest drop in the 30-member Dow Jones Industrial Average.
Caterpillar is "a barometer for the perception of global growth," Ted Grace, a Boston-based analyst for Susquehanna Financial Group, said in a telephone interview today. "People look at the data points and they are starting to pile up."
In the U.S., the Institute for Supply Management's factory index fell to 49.6 last month, the lowest since July 2009, the Tempe, Arizona-based group said today. Economists in a Bloomberg survey projected an August reading of 50, the dividing line between expansion and contraction. China's manufacturing activity slowed in August with the HSBC Manufacturing Purchasing Managers' Index falling to 47.6 last month, compared with 49.3 in July, according to data from Markit.
Announcements of cuts to capital expenditures by Australia's Fortescue Metals Group Ltd. and other mining companies are also weighing on the stock, Grace said. Resource industries accounted for 26 percent of Peoria, Illinois-based Caterpillar's revenue last year while construction accounted for 33 percent, according to data compiled by Bloomberg.
Fortescue, Australia's third-biggest iron-ore producer, today cut its full-year spending forecast by 26 percent to $4.6 billion. BHP Billiton Ltd., the world's biggest miner, last month delayed about $68 billion of projects, including an iron- ore port expansion.
Joy Global Inc., a Milwaukee-based mining-machinery manufacturer, fell as much as 4.7 percent. Deere & Co., a maker of agricultural and construction equipment, dropped 1.8 percent.