'Mad Money' Recap: Bull in China Shop (Update 2)

NEW YORK (TheStreet) -- Jim Cramer pondered the relevance of China to the U.S. markets as he led off his "Mad Money" TV show Monday.

He told viewers that while the health of the Chinese economy is a factor for U.S. stocks, the recent weakness is a blessing in disguise, giving some of our overblown stocks a chance to rest and recharge.

Cramer said he's not worried about the health of the Chinese economy. He said that the country is doing what it can to spur growth in construction and consumption, and many U.S. traders saw the weakness coming and have already rebalanced their portfolios.

Furthermore, Cramer said that while China is important, U.S. markets are strong enough now that they no longer have to follow the Chinese in lock-step. "If oil calms down, the Chinese can engineer a soft landing," he said.

So which stocks will be most affected by China? Cramer said the materials stocks, like Alcoa (AA) , will continue to be weak, as will the oil stocks, led by National Oilwell Varco (NOV) , a stock that's cratered 8% in the past two weeks.

But on the plus side, Cramer said opportunities are being created in the defensive stocks, names like Heinz (HNZ) and also the drug stocks. Cramer said he likes Bed Bath and Beyond (BBBY) and Pepsico (PEP) on weakness.

Regarding the tech sector, Cramer said this group likely won't rally without the help of Apple (AAPL) , a stock which he owns for his charitable trust, Action Alerts PLUS. But with Apple scheduling a product announcement on Wednesday, even the tech sector should be ready to rally again by mid-week.

Innovative Touch

"Forget about information technology stocks," Cramer told viewers. He said that today's hot technology names are all about innovation, but they're not necessarily involved with microchips or the Internet.