Tuesday’s session bucked the trend of putting technology on the back burner: Jim Cramer

CNBC’s Jim Cramer said Tuesday’s eventful session saw a shift in market trends, with hot tech and artificial intelligence stocks, which have largely led the market in recent days, retreating, while broader economy companies gained.

“When the market got excited earlier today, it was all about the non-data center part of the economy, the Rip Van Winkle economy that, frankly, has been dormant for a long time,” he said.

Indexes sawawed on Tuesday as Wall Street digested comments from Federal Reserve Chairman Jerome Powell and news of escalating trade tensions between the United States and China.

At the end of the day, President Donald Trump provoked investors by posting on Truth Social that the United States was considering “terminating trade with China related to edible oils” in retaliation for Beijing’s refusal to buy U.S. soybeans.

of S&P500 It fell as much as 1.5% during the volatile session, rose 0.4% at the high, and ended up down 0.2%. of Dow Jones Industrial Average At one point it rose nearly 1%, but it ended with a 0.4% rise. of Nasdaq Composite Shares closed 0.8% lower after falling as much as 2.1% during trading.

Cramer said investors were encouraged by Chairman Powell’s indication on Tuesday afternoon that the central bank may stop reducing its bond holdings. Cramer said the Fed’s bond sales are helping to keep mortgage rates higher than necessary, adding that the housing market can be a proxy for the economy beyond the tech industry.

Mr. Kramer was impressed by the big banks’ earnings, particularly their strong performance: wells fargo. He also pointed out that Builder’s First Source This move suggests that it may indicate a better housing market is on the way. Retail home renovation name home depot and lowe’s There were also benefits, he continued.

“I’ve always liked the bank-driven market,” said Cramer, who said he hopes it will ease some of the data center and speculative stocks that have made big gains recently.

“The bottom line is this market as a whole is getting too hot,” he said. “We can also tap into the real economy a little bit. We felt pretty good today before the president stepped up his attacks on China again. Hopefully he’ll be more conciliatory and we’ll be able to bounce back quickly.”

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Disclaimer CNBC Investing Club owns shares of Wells Fargo and Home Depot.