Analysis: AAPL HON ITW MMM BP APC XEC SLB JWN KSS

Following a strong initial open, the U.S. equity markets are holding their early gains on Monday. The S&P 500 and the Nasdaq are pushing higher Monday afternoon, while the Dow Jones Industrial Average is trading with a more muted tone as key member Apple (AAPL) (more on this below) is weighing down the index.

Quickly recapping from last week, although tech has felt some pressure over the past few sessions, there have been pockets of groups that have benefited from this outflow from strong performing tech names into other sectors. The occurrence of these types of rotations, which come and go as they please, is why we always stress the importance of maintaining a well-thought, diversified portfolio. Diversification is called "the only free lunch" for a reason.

And while tech felt the brunt of the pain last week, we do not think the selling was any reason to run for the hills. Instead, we view those types of pullbacks as an opening to add to high-conviction names with terrific long-term stories.

A few stocks that have made notable moves higher during this recent rotation are Honeywell (HON) (which we recommend before and after its upcoming breakup), two previously hated industrials (Illinois Tools Works (ITW) and 3M (MMM) ), and our retailers, Nordstrom (JWN) and Kohl's (KSS) .

Apple is lower for the fourth straight day. Currently, the market is pricing how the newly announced tariffs on $267 billion worth of Chinese goods (mentioned on Friday here) impacts the smartphone maker. According to Bloomberg's Mark Gurman, the tariffs are expected to affect products such as the Apple Watch, Airpods, HomePod, Airport routers, Apple Pencil, Mac mini, and other adapters/cables. Adding to the uncertainty, over the weekend President Trump tweeted that the company should move production plants to the U.S. to avoid these additional tariffs.

Even though the country's largest company by market cap is now in the cross-hairs of the trade dispute, we reiterate AAPL as a stock to "own, don't trade." The tariff news may make things noisy in the short-term, but the company's ecosystem of products is second to none, and its brand loyalty keeps customers coming back for more. These themes feed its strengthening Service revenue stream, which highlights an underappreciated razor-razor blade business model.

And remember, selling to Apple means you're giving your stock back to the company as its massive $100 billion share repurchase program is only constrained by the federal limit that is allowed to be purchased on any given day.

Looking ahead, the company will host an event this Wednesday, Sept. 12 at 1:00 p.m. ET. At the event, Morgan Stanley analyst Katy Huberty expects the company will unveil three new iPhone models with varying screen sizes, an Apple Watch Series 4, an updated iPad Pro, and updates to the Mac portfolio.

On the oil front, both WTI and Brent crude are trading higher on the day, with the former pushing back to the $68 handle, only to retreat later. Monday's gains in the benchmarks are being attributed to a lower Friday rig count, which implies a slower rate of drilling activity, as well as the ongoing implications of the U.S. clamp down on Iranian oil exports.

As a reminder, as part of the economic sanctions the U.S. re-imposed on Iran, crude oil exports from the country are expected to be greatly reduced before the Nov. 4 sanction date. We expect the cut in global supply will provide support to commodity prices, which in turn allow upstream operations in companies like BP plc (BP) , Anadarko Petroleum (APC) , and Cimarex (XEC) to realize higher prices and improve cash flows.

From a global investment perspective, we expect that to recover from previous years of underactivity, benefiting the best-of-breed, internally based Schlumberger (SLB) .

Action Alerts PLUS, which Cramer manages as a charitable trust, is long AAPL, ITW, MMM, HON, BP, APC, XEC, JWN, KSS and SLB.