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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.

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)

, 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)

.

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

Cramer recommended banks such as

JPMorgan

(JPM)

and

Goldman Sachs

(GS)

, 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)

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

Home Depot

(HD)

, also in Action Alerts PLUS, and

Lowe's

(LOW)

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)

,

Research In Motion

(RIMM)

and

Amazon

(AMZN)

, as well as Action Alerts PLUS names

Qualcomm

(QCOM)

and

Hewlett-Packard

(HPQ)

.

Amazon.com

(AMZN)

. 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)

, and he gave a thumbs up to

Pepsi

(PEP)

. 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

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clicking here.

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