Why Shares of Caterpillar Slumped in June

Shares of construction, mining, and energy equipment company Caterpillar (NYSE: CAT) fell 17.2% in June, according to data provided by S&P Global Market Intelligence. The move comes in concert with a general sell-off in stocks the market thinks are exposed to cyclicality in the economy. Caterpillar is one of them. So whether it's construction, mining, aggregate (mainly used for road building), energy, or transportation equipment, Caterpillar's end markets will ebb and flow with the economy.

You can see that in the chart below showing long-term revenue and earnings before interest, depreciation, and amortization (EBITDA). In particular, note the decline a few years after 2014. This reflects the slump in mining and energy spending in response to the fall in energy and mining commodity prices.