The connection between market prices and economic realities is partial, uncertain, changeable and irrational. A connection there is, however, and after an equity market rout such as yesterday’s, causes will be sought and fingers will doubtless point to poor earnings reports from two very large industrial companies: 3M and DuPont.

Sales at DuPont fell sharply and earnings per share were sliced in half. Organic sales growth was slightly positive at 3M and earnings rose but profit targets for the year were cut. It is easy to moan about the declining US industrial base. The US was not the problem at either company, though. The problem was Asia, which represents a quarter of DuPont’s sales and almost a third of 3M’s. Du Pont saw Asian volumes and prices fall 10 and 5 per cent, respectively, excluding currency effects. At 3M, falling prices outweighed volume increases.

Du Pont noted two sources of pain in Asia. First, and more important, was the slowdown in Chinese construction and infrastructure spending. This hit the company’s performance chemicals business, which sells heavily to producers of paint and flooring. Second came excess capacity in the solar panel industry, which DuPont supplies with materials. It was 3M’s electronics business that suffered most in Asia.