Commodity Blowoff Creates Widespread Panic

That was pure panic. Just colossal panic. Everywhere. The oil and gas complex literally gave back tons of what it has made. Take Devon (DVN - commentary - Cramer's Take), obviously the best of the lot. With natural gas up about 60% year over year and up nicely this year alone, DVN is up 18% for the year and 30% year over year.

Or how about copper? We have seen close to a 30% slide in Freeport (FCX - commentary - Cramer's Take) in the last few weeks, but copper has had nowhere near that decline.

Or how about oil drilling? We have a tremendous shortage in rigs, and the only major builder of rigs is National Oilwell Varco (NOV - commentary - Cramer's Take). That stock is only up 6% for the year.

It is clear that we have had a commodity blowoff here. But the stocks have been hammered more than the commodities, and unless you think that natural gas is going back to $10 or oil to $120, it isn't a bad level to buy these.

Obviously we have a total smoking rally in the drugs and a nascent one in the stocks of companies that need oil lower. I like that -- they are oversold. But I think the old leadership is not dead and buried. I think it is having a classic retreat in a bull market.

Perhaps, just perhaps, if the financials stay out of our way for a couple of days, we can actually have a rally that lasts after that amazing panic of the morning.

At the time of publication, Cramer was long Devon, National Oilwell Varco and Freeport-McMoRan.

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