Cramer's 'Mad Money' Follow-Up: Pullback Buys

Jim Cramer said that a selloff in the market can create buying opportunities in stocks with pullbacks of 5% or more.
Author:
Publish date:

On Monday's "Mad Money" TV show, Jim Cramer encouraged viewers to see the day's selloff as a "gift" and that pullbacks of 5% or more in the right sectors made for great buying opportunities.

He said China is still working and recommended

iShares China 25 Index

(FXI) - Get Report

, which he owns for his charitable trust,

Action Alerts PLUS, on a pullback.

On Tuesday, FXI closed up 86 cents, or 2.7%, at $32.23.

He also liked

Nordic American Tanker

(NAT) - Get Report

.

Nordic American Tanker closed up $1.64, or 5.6%, at $30.74 on Tuesday.

Cramer recommended banks such as

JPMorgan

(JPM) - Get Report

and

Goldman Sachs

(GS) - Get Report

, both of which he owns for Action Alerts PLUS. He said that with banks, the "winners" are safe.

JPMorgan was up $2.84, or 9.6%, to close at $32.53, while Goldman was up $5.35, or 4.7%, at $120.36.

Industrials are also relatively safe, he said, including fellow Action Alerts PLUS holding

Emerson

(EMR) - Get Report

, and he recommended focusing on housing retailers rather than homebuilders. Specifically, he liked

Home Depot

(HD) - Get Report

, also in Action Alerts PLUS, and

Lowe's

(LOW) - Get Report

as a play on a bottom in housing.

Emerson closed up 80 cents, or 2.5%, at $32.46, Home Depot was up 72 cents, or 2.9%, at $25.87, and Lowe's was up 83 cents, or 4.2%, at $20.55.

As for technology stocks, he said the tech sector will turn first, and he recommended

Apple

(AAPL) - Get Report

,

Research In Motion

(RIMM)

and

Amazon

(AMZN) - Get Report

, as well as Action Alerts PLUS names

Qualcomm

(QCOM) - Get Report

and

Hewlett-Packard

(HPQ) - Get Report

.

Amazon.com

(AMZN) - Get Report

. He said this group turns first and is the hottest sector out there.

Apple closed up $1.26, or 1.1%, at $121.76, while RIM was up $1.93, or 3%, at $67.03. Amazon closed up $1.17, or 1.5%, at $78.74 on Tuesday; Qualcomm was up 64 cents, or 1.6%, at $40.27; and Hewlett-Packard closed up 75 cents, or 2.2%, at $35.43.

In health care, Cramer's beaten-down pick was

Abbott Labs

(ABT) - Get Report

, and he gave a thumbs up to

Pepsi

(PEP) - Get Report

. Both of those stocks are in Action Alerts PLUS.

On Tuesday, Abbott closed up 28 cents, or 0.6%, at $44.37, while Pepsi was down 51 cents, or 1%, at $49.35.

At the time of publication, Cramer was long Qualcomm, Emerson, Pepsi, Abbott, Hewlett-Packard, Home Depot, JPMorgan, Goldman Sachs and iShares China 25.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. Click

here to order Cramer's latest book, "Mad Money: Watch TV, Get Rich," click

here to order his book, "Real Money: Sane Investing in an Insane World," click

here to get his second book, "You Got Screwed!" and click

here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by

clicking here.

TheStreet.com has a revenue-sharing relationship with Traders' Library under which it receives a portion of the revenue from Traders' Library purchases by customers directed there from TheStreet.com.