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(CNN Business) —  

Weak outlooks from a pair of industrial giants sent stocks into a tailspin Tuesday.

Shares of Caterpillar (CAT) and 3M (MMM) were each down nearly 10% in mid-morning trading – and that was a big reason why the Dow plunged more than 500 points.

Caterpillar’s decline comes despite the company reporting its best ever third quarter results.

But its outlook, while in line with its previous forecasts, was below what Wall Street was expecting.

Investors may be worried about rising costs. The heavy equipment manufacturer said that increased material and freight costs were having an impact. The price of steel has risen by about 30 percent this year in the wake of US tariffs and rising prices.

But Caterpillar said in its earnings report that it would raise prices for its customers and rein in costs to help offset the tariffs.

While tariffs have hurt, the trade war with China hasn’t. Caterpillar even said that sales in Asia/Pacific surged 46% from a year ago, and the company cited “significant impact from improved demand in China.”

3M didn’t even mention China in its earnings release. The Post-it maker simply noted that sales in Asia-Pacific were up more than other markets.

The company pointed to currency for its poor outlook.

The dollar has remained strong this year, in part due to the Federal Reserve’s rate hikes and the robust US economy. A stronger greenback hurts earnings for multinational companies. 3M had previously expected that currency fluctuations would boost its profits.

A slowdown in profits for industrials is bad news for the markets – even if the decline was expected.

After all, the CFO of Caterpillar spooked Wall Street back in April when he said that the company’s results at the time may have been the “high water mark” for this business cycle. The Dow plunged 425 points that day.

It looks like his forecast was just off by a couple of quarters.