Caterpillar third-quarter earnings up 21%

CHICAGO: Caterpillar Inc, the world’s top maker of earth-moving equipment, diesel engines and gas turbines, posted higher quarterly earnings on Friday but missed analysts’ expectations, and cut its full-year earnings outlook.

Caterpillar said third-quarter earnings rose 21% as strong sales overseas offset a slump in the US residential construction market, but the results fell short of Wall Street expectations. Its shares fell more than 5%.

The company also sounded an alarm about the outlook for the wider US economy, suggesting the the housing downturn was spreading to other parts of the economy and pulling the broader market lower.

Caterpillar warned that several key US industries it serves, including trucking and nonmetal mining, were “in recession,” and said its machinery sales to nonresidential builders were being hit as hard as its sales to the residential building industry, which it said was in “severe recession.”