Jim Cramer says it is worth buying cyclical stocks after Monday’s fall

CNBC’s Jim Cramer said on Monday that after a brief dip in cyclical stocks, investors now have a chance to reduce their technology stakes and buy industrial stakes.

The presenter of “Mad Money”, who advocated building a balanced portfolio, pointed to stocks like Nucor, Boeing, Union Pacific, General Motors, Ford and Southwest Airlines after each of its shares fell about 2% or more .

He also put United Airlines on his radar. The shares fell 4% during the trading session.

“You need to remain diverse. If you only have technology, you will miss out on the big reopening actions that were thrown away today,” he said.

Financial and industrial stocks traded lower on Monday, with technology stocks rising.

The blue-chip Dow Jones Industrial Average, which is performing better this month, added 103 points to close at 32,731.20, up 0.32%. The S&P 500 benchmark advanced 0.70% to 3,940.59. The high-tech Nasdaq Composite, which has underperformed so far this year, rose 1.2% to close at 13,377.54.

Investors in the past few weeks have transferred money from high-growth stakes to economic reopening talks, Cramer said.

“I don’t want to totally rule out the possibility that rotation has run its course. Today’s shift to technology has been very powerful,” he said. But, in the end, Cramer attributed Monday’s technological boost to a “rebound against the trend”.

“In this new environment, banks and industries cannot go wrong, while technicians cannot do the right thing, even if they obtain the occasional counter-trend of suspension as they did today,” he said. “Take advantage of this temporary weakness in the industrial sector, increase the strength of some technology if you need money to buy the industrial sector. … I don’t think you will regret it.”

Cramer highlighted the following names:

Disclosure: Cramer’s charity fund has shares in Boeing and Ford.

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