I suppose CAT has a sizeable exposure to China, it certainly has exposure to Europe, the rest of Asia and Latin America, all regions in the process of slowing down.  Generally speaking, multinationals will continue to be under pressure until there is a hint of a bottom globally and/or stock prices attract buyers.  Given the steep declines some of them have endured this year, they may become attractive if the market declines an additional 7 to 8%.  Then again, if the market goes deep into bear market territory, who knows?

One interesting and very telling detail on the CAT warning is that the company has never experienced 4 consecutive years of declining revenues, this includes all recessions in modern times and the depression of the 1930s.

That of course begs the question:  Did China become such a high % of its revenues?  Or is it a combination of all its regions falling off a cliff so to speak?

Reading a bit on CAT, it stated:

""a convergence of challenging marketplace conditions in key regions and industry sectors — namely in mining and energy.""

Which tells me that the slowdown in China is probably the biggest factor in the mining sector, and Energy is all of OPEC, Russia and US

There is still quite a bit of "buy the dip" mentality, which I believe is transitioning into "sell the rally". Just look at the S&P or Nasdaq last 6 months. We had higher highs earlier this summer, albeit marginally so, and in the last couple of months we've been seeing lower highs plus that rapid drop a month ago, which even 4 weeks later the market only had enough conviction to retrace 50% of (on the S&P). We're also seeing several death crosses. This all adds to wariness, transitioning more people from dip buyers to rally sellers.