CNBC’s Jim Cramer said Monday that after a brief dip in cyclical stocks, investors now have a chance to cut their technology holdings and buy industrial stocks.
The “Mad Money” host, who championed building a balanced portfolio, pointed to stocks such as steelmaker Nucor, Boeing, Union Pacific, General Motors, Ford and Southwest Airlines after each of their shares fell 2% or more. .
It also put United Airlines on its radar. The stock fell 4% during the trading session.
“You need to stay diversified. If you only have technology, you will miss out on the big reopening stocks that were dumped today,” he said.
Financial and industrial stocks were lower on Monday, as tech stocks rose.
The top-line Dow Jones industrial average, which is outperforming this month, added 103 points to close at 32,731.20, up 0.32%. The benchmark S&P 500 index advanced 0.70% to 3,940.59. The high-tech Nasdaq Composite, which has underperformed so far this year, rallied 1.2% to close at 13,377.54.
In recent weeks, investors have shifted money from high-growth holdings to economic reopening operations, Cramer said.
“I don’t want to totally rule out the possibility that the rotation has run its course. Today’s move into technology was very powerful,” he said. But ultimately, Cramer attributed Monday’s tech boost to a “counter-trend rally.”
“In this new environment, banks and industry cannot do anything wrong, while technicians cannot do anything right, even if they get the occasional clemency countertrend like they did today,” he said. “Take advantage of this temporary weakness in the industries, scale from some technology to force if you need the money to buy the industrial ones … I don’t think you will regret it.”
Cramer highlighted the following names:
Disclosure: Cramer’s charitable trust owns shares in Boeing and Ford.
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