all right. final trade. shannon, you start us off. >> valero energy >> i like nike here. >> moderna >> bac, bank of america. >> good stuff. thanks, everybody. "the exchange" is now. thank you very much, scott hi, everybody. i'm kelly evans. here is what is ahead this hour. stocks are resuming their slide as we kick off the new week with tech back to leading the decline. the nasdaq down 2% semiconductors down nearly 3%. we dissect the downturn to look at what is causing it this time and whether we're in for a fourth quarter to forget meantime, the chase is on for energy, those stocks bucking the down trend again as oil hits a seven-year high, remaining the best sector for the year, only one in the green last month and

frankly not the sector we want to see outperform. anyway, will its winning streak continue we will delve into that. facebook falling after major negative publicity, plus now its services including whatsapp and instagram experiencing outage. the shares down about 5% at last check. plus a check on crypto and other big movers first, dom chu with the numbers for us that social story playing out a large part in the market decline right now. to give you an idea where we stand in the markets right now, it is near the session lows of this point in the stage, the nasdaq in positives as kelly highlighted, the epicenter for a lot of the weakness right now. tech and communication services, media-type companies are the ones hit the hardest for that reason you see it down 2.5% for the nasdaq, 365 points. the s&p 500, now below 4,300 down 71 points or 1.5% declines there. the dow industrials outperforming if that's what you want to call it, only down

1.25%, 432 points, 33,893 the last trade there as kelly mentioned, the social media stocks a focus for today the bombshell "60 minutes" report last night, highlighting the deficiencies facebook allegedly has with handling misinformation not helping sent meant. facebook shares down 5.5%. twitter, down 6.5% snapchat down 6.5% and 6% declines for pintrest. the entire social media complex taking it on the chin in today's trade. one divergence a lot of traders are watching tesla comes out with better-than-expected deliveries of vehicles in the past quarter, it is flirting between gains and losses right now however it is still high at the same time the ticker arkk is actually lower. check out divergence developing for a couple of months now tesla, the white line continues to trend higher. meanwhile, the arkk etf

continues to drift lower i only call it out, kelly, because as many viewers and listeners now the single biggest holding in that tech arkk etf, tesla shares with a roughly 10% weighting. a lot of the correlation has been there over the better part of the year. it is breaking down here we will see if that divergence plays out in coming days and weeks. back to you. >> maybe they shouldn't have trimmed it but that's the way it goes thank you very much. short-term treasury yields are spiking after headlines by president biden in the past hour investors worry about a looming default there. you can see the spike behind me. ylan mui is in washington with the latest on us. >> reporter: kelly, president biden took republicans to task for blocking a vote to race the debt limit biden called on the gop to allow democrats to bring the bill to the senate floor and to pass it with a simple majority vote. no gop support needed. but just two weeks left to go before the treasury likely hits

the debt ceiling, biden said there was no time for elaborate procedural schemes he said that's when accidents happen and that he could not guarantee that the u.s. would not default. but this morning senate minority leader mitch mcconnell sent the president a letter, doubling down on his position that republicans will not help democrats do this job. he warned that the nation is sleep walking towards significant and avoidable danger now, the top democrat in the senate, chuck schumer, said today he does plan to vote on the debt ceiling this week and he said he will keep the chamber in this weekend if it is necessary. kelly. >> it is october now so the days are becoming more important. thank you very much, ylan mui for the moment concerns about a debt default may be spooking the markets but my next guest remains bullish and sees dow 40,000 in the next 18 to 24 months. joining me, the chief market manager at hennessy funds, neil hennessy welcome back >> thanks, kelly >> would you describe it as

unbridled enthusiasm for stocks and tell me what you make of the fourth quarter choppiness that we're seeing >> well, i think people just have to look at the total picture and put it in perspective. i mean if you look at what has been happening in the marketplace and now the headlines are tech are getting beat up and they're getting killed, well, they should have if you look back at 2020 market, the advance stock was up 45% if you take out six of those companies, facebook, microsoft, google, apple, tesla, amazon, the market was only up 21% the same thing has been happening this year. what i think is going to happen is we don't have euphoria in the overall marketplace. we have it in pockets of the marketplace, but not the total marketplace. people are going to start to go back and start to buy quality in under valued companies >> tell me about energy, neil. what do we do with this one? what is your view on it because it is not a story of, hey, you

know, the equities are mispriced relative to the crude. this is like global energy crunch, game on. kind of worrisome. >> as you know, kelly, we have the hennessy gas fund here interesting enough, if you look at natural gas, it is at $6 btu. it is just crazy it went from a couple of bucks to there so you look at the utility companies, they're going to continue to produce a lot more profit and revenue, which, in turn, is most likely going to raise dividends in arena we are having a short-term spike in energy cost that are scaring people, but you take that and you take it, put it with the other headlines of stagnation and this and that, but look at it we still have mortgage rates under 3.5% we have a ten-year treasury that's at 150. i know people are saying, god, it has really spiked kelly it went from 130 to 150, flag stick a 15% move but it doesn't do anything to the economy. when you put everything together and you look at what is

happening, the dow jones is selling at 19 times earnings that certainly is not an over valued marketplace on top of it, we are just coming out of this pandemic can you imagine once car sales start to spike back up, general motors was down one-third amount of cars they sold. so we have this supply chain problem. that's going to solve itself over time, and the next thing you know is we will be off to the races. >> so. >> companies are going to make that much more money they just can't help making more money with the amount of money sitting in the consumers' pocket, which is over $2 trillion >> right let me just kind of -- there's one area of what you just discussed that is a source of discussion, debate, controversy, whatever you want to call it you are saying gm sales were down by a third year on year last month but you kind of turned the calendar towards 2022, they will be back to a normalized level again the other school of thought, which you could call it the cathy wood point of view, but she is saying the surplus

inventory is now in driveways and garages, neil. there was historic demand for autos that is not going to come back right away. that, if anything, now that entire physical goods sector has experienced possibly a glut that could cause a hangover and put downward pressure on prices and demand for the next couple of demand >> well, i think that you had the used car market take off because nobody could get a new car. very difficult if you look at what the dealers are getting for their cars now, they're not just getting invoice or less than invoice, they're getting above invoice if you want to pay that kind of money the bottom line here is people like to buy new. they do not like to buy used first. so essentially once this supply chain goes away, all of these cars and trucks that are being made that are sitting there, and once they get the chips in them, are going to go quickly. people want to spend their money. they've been house bound for two years. i am looking forward a new

truck. but i can't get it >> yes >> so what am i going to do? >> you and tyler has talked about trying to get a car these days you and many other people just who we come into contact here. it is obvious there's still pent-up demand, but you have to wonder what is on the other side of that. semiconductor, neil, same thing people are talking about, inventory builds, in autos, yes, but also in laptops. we don't like inventory builds in the semiconductor space this is what morgan stanley said this morning, that the risk is as we turn towards reopening, services are in demand again are we going to see the price of a lot of goods plummet because they were overbuilt? >> i'm not sure you will see it plummet. once people get used to a higher price, they don't really then -- >> go back >> balk too much at it >> yeah. >> we can look back a couple of years ago, five years ago when all of a sudden there was a surcharge for gasoline so laundry company or whatever would deliver, there would be a

surcharge because oil was that and the gasoline was that much more expensive, but it never really came off. you look at restaurants and adding on health insurance in different communities, it never came off so, you know, i'm not sure you are going to see a decline in prices, but you are not going the see them go up >> i should mention that your particular favorites lately, kb home, casey's general stores, vista outdoor, we just spoke to that ceo while you like the market broadly speaking, there are individual names people are looking for that you think could outperform thanks for your time today anything you want to add >> no, but let's just look hopefully to the holiday season where we can actually buy some presents if we can get the stuff in the ports >> i know. you better send yours out early this year. maybe a halloween timing neil hennessy with the hennessy funds. thank you as always. we appreciate it going to take a quick break here energy is one of the only bright spots today with crude coming off its fifth straight positive week and sitting at three-year

highs. up next, a look at the energy rally and particular names that could benefit plus, a record year for cyberattacks amid a spike in global hacking activity. we will speak with ceo of a cybersecurity firm as the corporate name changes today here is a look at the sector in the lead, tech is the worst performing, utilities are in the number two position. we are back in a moment. this is "the exchange" on cnbc e emergency medicine possible at 40,000 feet. instead of burning our past for power, we can harness the energy of the tiny electron. we can create new ways to connect. rethinking how we communicate to be more inclusive than ever. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change. faster. vmware.

welcome change.

working at recology is more than a job for jesus. it's a family tradition. jesus took over his dad's roue when he retired after 47 year. now he's showing a new generation what recology is all about. as an employee-owned company, recology provides good-paying local jobs for san franciscans. we're proud to have built the city's recycling system from the ground up, helping to make san francisco the greenest big city in america. let's keep making a differene together.

♪ ♪ welcome back, everybody. let's focus on today's big winner, energy again the sector rallying after opec sticks to its plan to only gradually raise oil output wti is at $78 a barrel, a seven-year high. every member of the energy sector is in the green today and for the year my next guest expects higher oil prices given the current under investment in crude. stan major of the wile ae mid cap value fund it is great to have you here boy, is it a hot area all of a sudden what would you tell investors that it is a great space to ride until the end. >> great to be here. this has been five to ten years in the making. when you look at the energy sector we have seen a lot of underinvestment. today we are spending half as much as we did five to ten years

ago, but we are consuming more even with covid. so there's been a lot of underinvestment. what that does is with pretty good demand, demand is strengthening as we're coming out of covid productive capacity is declining. we are just not spending enough money to keep capacity up, whether in the u.s. or with opec, opec plus. we have a very tight market. the interesting thing about today, i have been covering this for 25 years, is that historically when you have seen good prices, when you have seen good returns, you have seen capital come into the business so simplistically if you think about a balance sheet, if you want capital to come into the business you need to raise debt and equity on one side of the balance sheet to finance assets. you usually see that when things are good we are seeing the opposite today. so we've got a tight oil market, but oil companies are doing the opposite they're paying down debt, they're returning capital to shareholders so the asset side is not increase in. so that makes this a very

interesting market where - >> yeah. >> -- this tightness can continue >> i have about 38 questions for you. let me try to get -- for our audience who kind of just wants the picks, let me get it out there right away you like marathon oil, you like penn virginia which has tripled. you have names like karen energy, vistra, nrg, cosmos as 2% to 3% holding i want to discuss with you the comments from the iae today who just said that the spikes in energy that we're seeing, he was talking more specifically about nat gas but i want to ask broadly speaking he said they have nothing to do with the world's transition away from fossil fuels. is that accurate is the underinvestment only because people want a strong return or is to me is it quite obviously because there's a massive divestment push away from fossil fuel happening as well >> i would say think about it with common sense. energy is a very long lead-time business if you think about deep water,

it will take you ten years before that project comes on with so much uncertainty about crude oil demand in 2031, people just are not spending the money today. so maybe he's making the case that directly today it is not the transition to fossil fuels, but psychologically people are not committing long-term capital. so i think that does have something to do with what we're seeing today i think it is early signs. >> so the knock-on question i then have is, one, about investment returns you know, there are people writing that if the fossil fuel industry just returned cash to shareholders they could generate tremendous financial returns you know, sort of like what we saw with altria over the past 15 years or so. but if they tried to invest in order to keep up with the changing times that in a way presents more investment risk eve an places like engine no. 1 are pushing exxon to pursue those strategies do you as an investor have a preference in terms of which path you would like them to take >> we absolutely do have a

preference if you think about the math about what you are asking, currently these companies -- you mentioned marathon they're generating significant amounts of free cash flow. the companies we're invested in are generating 20% of their market cap in free cap flow. >> wow >> massive amounts $2 billion of free cash flow, the market caps are $10 billion or $11 billion or so when you think about that, they're taking the capital and unlike the past returning it to shareholders if you think about a share buy back plan which we favor over dividends, a company with buy with a 20% free cash flow yield, can buy their entire shares outstanding back in five years that's incredible. additionally, the business should consolidate so as, you know, if you look at the permian and the eagle , there's 30 or 40companies. there should be two or three or four with consolidation you get efficiency and higher profitability also >> wow >> there's a lot of things going

right. you know, we think if they, again, focus on the right side of the balance sheet, pay down debt, buy back stock, it is not going to grow production it can be very good for investors. >> so you are sort of on that side of the equation very, very interesting stan, we have to leave it there but i hope to have you back soon thank you for your time today. >> great appreciate it. >> stan majher is with the hoch kiss and wily mid cap value fund let's bring in julia b boorstin what is the latest >> the latest is facebook has filed a motion to dismiss the ftc's amended complaint against the company. in a 55-page document facebook saying the ftc alleged no probable basis for branding facebook an unfair monopolist, saying it controls in excess of 60% of the market, accusing the ftc of cherry picking data and including data on a handful of apps and saying that the ftc had

no evidence that facebook's market position was protected by barriers to entry -- barriers that prevented competition, saying competition did occur from snapchat and others also, kelly, facebook reiterating its claim that one be recused because she cannot be impartial. it will be interesting to see how it plays out >> they're experiencing outages and now i think senator markey calling on the ceo to testify. >> yes i have to athat thsay that thisg is because today is the deadline they had 30 days today is the deadline when they have to file traditionally these things are not filed ahead of the deadline. they're always filed on the day of the deadline, so i think it is a coincidence >> i think as journalists we understand that, nothing is done until it has to be facebook shares down 5%. at session lows they were down nearly 6%. that reflects the pressure

across the tech space. there's the dow 30 heat map as the index still down about 390 points merck and chevron and ibm helping it keep positive visa, salesforce and apple among the biggest laggard. there's another threat lurking for the blue chip. we will explain after this ♪ i'm a reporter for the new york times. if you just hold it like this. yeah. ♪

i love finding out things that other people don't want me to know. mm-hmm. [beep] i just wanted to say... ♪ find yourself in these situations and see who you are. and that's just part of the bargain. ♪ there's software. aand then there's rt industrial grade software, forged from decades of industrial experience and insights. meet honeywell forge. analytical software that connects assets and people to deliver a cybersecure record of your entire operation. so that everyone, in your boardroom and beyond, speaks the same language. honeywell forge. industrial grade software.

welcome back to "the exchange" everybody. off the lous the dow about 150 points off the lows when we were down in the session. still down 1%. the nasdaq is still near the session loans, only about 40 points off the level

watch the continued pressure in some of the names today. s&p for its part down 1.5% let's zoom in on tech for a moment which is the biggest losers big tech names seeing biggest declines across the board. facebook is down more than 5%. look at the losses from the all-time highs they're starting to add up amazon the biggest underperforming with 15% correction apple, down 12%. alphabet down 10%. microsoft down 8%. lords town, blink, fisker and nio seeing declines. lordstown is around $6 a share right now. also some of the worst performers on the nasdaq the cloud names are seeing the selling pressure today, among the biggest laggards with docusign down 5.5% keep an eye on the semiconductor etf, down nearly 3% with names like nvidia down 5%, as more people look at areas of the semiconductor space that might

now be seeing a glut forming autos, laptop computers, things like that. we hlet's get to frank holland for an update now. hi, frank. >> hi, kelly in california clean-up efforts ramping up to limit damage from one of the largest oil spoils in recent california history. more than a mile of oil booms have been deployed while officials are racing to find and rescue animals harmed by the oil. on the news, the search for the cause of the spill, that's tonight at 7:00 eastern. new york city mandate for public school workers to be vaccinated has gone into effect. mayor de blasio says 95% of the 150,000 people affected have gotten their shots that includes more than 18,000 school workers who got vaccinated since september 24th. president biden will go to the chicago area on thursday he will be pushing his administration's efforts to encourage more americans to get vaccinated european regulators have approved covid vaccine booster shots for people 18 years and

older. the european medical agency says booster doses should be considered six months after the second shot was received that's the latest. kelly, back to you >> frank, thank you very much. still ahead, facebook falling again, about 5.3%. as we just said, it is down 15% now from its all-time high we will have the latest. there's been a lot of headlines today for the stock. as we head to break, some big news from inside cnbc. our own jim cramer is now delivered to your inbox with the cnbc investing club. he has been sending it out in the last few minutes he has daily e-mails, he is writing for our website, appearing in videos online to give you his unique insights into the market and what stocks he is trading in his trust he will tell you winners and losers you can sign up to find out more at cnbc.com/investingclub or with tt haqr code on the screen. we're back in a moment

hey lily, i need a new wireless plan for my business, but all my employees need something different. oh, we can help with that. okay, imagine this... your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep lisa has to send some files, asap! so basically i can pick the right plan for each employee... yeah i should've just led with that... with at&t business... you can pick the best plan for each employee and only pay for the features they need.

welcome back, everybody. let's catch you up on a few stories moving the nasdaq today. here to break down the headlines, editor-in-chief of the virgin cnbc contributor. delano and steve grasso who is

here, ceo of grass o. let's start with some of the movers facebook is one of the main ones here, down 5.5%. reported outages from everything they have the whistleblower saying the company is acting in self-interest. the company is up 20% this year despite questions about practices and social impact. so let's start with you, steve grasso is facebook kind of the reason why the market is under so much pressure today is it just getting swept up in all of this? is it just coincidental i guess it is down this much or what do you make of -- how would you relate its own problems to the problems the broader market is experiencing if there's any relation >> so it doesn't help to your point, right, kelly. on the show you cover the stories du jour obviously better

than anyone and you noticed that it has been about china, it has been about chairman powell, it has been about rising rates, it has been about the rotation out of growth into value so this is the latest of the stories that are hitting the market, but if i look back on a chart and go back to the summer of 2020 facebook was under a lot of pressure there as well, and that was bought. i do believe -- i do agree, i should say, with jim cramer that this time appears to be different. having said that, i don't know how different this is going to be and when buyers will step in. but back then the stock fell 20%. we're down from peak about 16% or so. another couple of points - >> are you a buyer, steve? >> i wouldn't be a buyer just yet, but i'm just giving the viewers out there 315 is your 200-day moving average that gets you right in line with the sell-off that we saw in the

summer/fall of 2020 if you are thinking about buying a dip in facebook >> that is certainly one line to watch. delano, are you a buyer here >> yeah, kelly i think as mentioned by steve a lot of factors at play and you should be a buyer here, as much as this dip is 15% to 16% off its highs. we looked at the bass news flow and we know there will be some more regulatory scrutiny and legal risk at play here, but looking at, you know, you pull back the chart as much and if you are looking at this as being one of the bigger and better mega cap performing stocks this year as well as the platform, as well as the family of products still growing about 3 billion daily average users with their family of products, and also the whole macro level of digital advertising and digital spin it still is a great tailwind for facebook here and i think it comes to play at some point, buyers step in you probably want to be careful at what entry points you enter but you should be looking for opportunities here >> neli, let me phrase the question this way. is there anything regulators

could do that would hurt facebook without helping investors? in other words most of the time if they pursue regulation it helps facebook, they can comply the best, they can comply better than anybody if they break it up, they wouldn't mind seeing instagram separate from facebook and whatsapp can they do anything that won't help the long-run financial performance? >> i think there's a lot regulators want to do. right now we are so exhausted by endless facebook scandals we might not be seeing this one for the scale that it has and the impact that it has what you have with the whistle-blower is facebook's own research, facebook's own employees saying, this company is hurting people in x, y and z ways, specific ways with teen girls and body issues, with radicalization that stuff is cannon fodder for regulators facebook says it wants

regulations, i think it wants to capture the industry in that way. i think every regulator in the country has been handed a sheet of papers from facebook itself that says this company is doing harm and it knows it i think it is going to take a lot for facebook to get through this in a way that doesn't result in a company being radically restructured whether that's a breakup or whether that's a governance change, which a lot of people would like to see, something is coming this time >> it seems to be, dilayno, it seems the only pressure could be massive devestment, although you if look at performance of altria, maybe not a bad thing. maybe you could destroy profitability by requiring them to have such a huge content staff that maybe it is no longer attractive does it make sense to you as an investor and do you see the risk looming at all >> it is certainly a risk. i do agree with some sort of esg front where facebook brings to the forefront maybe a plan on how to comply and make the platform better.

we know as much in the report, a lot of the reports and the content being shared is driven, nonfactual information, on harmful information. if they're bringing forth this and kind of getting at the forefront of it, it could be a good opportunity we want to see some governance changes that could potentially be strong for investors. i think it would be the best way to go as from a venture standpoint >> i know people say the risk is that advertisers leave but it feels like they won't leave until they have to and eyeballs go elsewhere let's move to netflix which is hitting an all-time high before dropping 3% in the wider tech sell-off this is only one of the faang names up in september and here is part of the reason. netflix's down loads are reaching all-time highs following "squid game. they're now at 12% after going nowhere in the previous year they're outperforming, steve are you a buying of netflix here >> i am not personally a buyer i don't own it, but it doesn't mean that i don't agree with the

bullish thesis when my four kids are asking me for my password for netflix i know that's a bullish theme for it, kelly. think about what netflix is, a high-growth tech stock where are we seeing rotation out of high-growth tech stocks. so you are going to get the macro headwind, but it has not damaged the stock as of yet. there has to be some growth stocks that are considered value, i daresay, and netflix is probably in that bucket along with apple, google and the jury is out on facebook you can't say it is value anymore. maybe amazon but the truth is, kelly, when we talk about this rotation, just brought it out and then i will get specific if you broaden it out and you say, okay, they're rotating out of tech and they're going into cyclicals and value, the market is going lower simply because there's the percentages of the

s&p -- >> yeah, the loss of market cap. >> -- aren't high enough in the value area but to answer your question, netflix, i'm still bullish but i would like to see it come back a little bit, come back to earth i think a lot of investors would as well. >> i will blend a couple of topics together. if you would be a buyer of netflix, would you be a buyer of amc? because we had 4 million people in theaters over the weekend, stock is still lower today we have the bond moving well internationally but flops here at home. what would you do with amc i mac i x is outperforming todai should note. >> i max would be my bet today i max is an event-driven stock what i mean by that is when you want to see a movie like the caliber of a bond movie or an adventure movie, you go to i max. >> yeah. >> people want to get out of

their homes. it is not like watching in your living room when you have surround sound i would be a buyer of i max into the bond release >> delayno, what about you you can throw in another streaming play if you would like to do it versus theater? >> i'm long netflix and bullish netflix, and the main reasons i would look to ad here is netflix did hold up in september which was pretty strong. we saw massive sell-off in september, a correction i should say. so when you are looking at netflix the big thing that investors are looking for is the queue up and the content coming in quarter 4, which we know "squid game" has been a massive success. there's more content in q4 i think will be bullish in the sense of bringing the content to the forefront. i think that's the reason why well-capitalized, obviously the balance sheet is doing well, all of the cash is going into content. i think the big thing in the streaming competition is going to be content and who wins that area

i think netflix is doing a really good job. i still would be looking at netflix here >> i will give you the final comment as i'm sure you have seen the excitement around "squid game" the fact that netflix is finally acting like it used to is it time to curb our enthusiasm about this or not >> i think looking at these numbers and the social media growth is a proxy for subscriber growth, which is what netflix has been soft on recently. we will see if this translates into actual subscriber growth or reduced churn, which i think is actually bigger danger for netflix. >> the church itself with all of the other options out there. finally, nilay, about traditional movie theaters, do you think it is a head fake or are they starting to mount a comeback here? >> i think it is a little bit of a comeback you look at basically loud movies, i think you want to see loud movies in theaters with big sound systems and huge screens and movies like "many saints of newark" are better at home with the captions on so you can understand what people are saying i think it will be a split that carries off for time to come

>> if people want loud, they can come over to my house for free and i won't charge, providing popcorn and a variety of snacks. thank you for your time today with some of the names people can add. we really appreciate it. checking on the broader markets right now, the s&p and dow are down more than a percent. the nasdaq still hit the hardest with declines of 24.3% some of the worst performers were the former stay-at-home high flyers like zoom, peloton and docusign we will talk about the impact a strong dollar could have on stocks and commodities stay with us we are back in a moment.

whatever i suggest to my patients is usually something that i have tried. capsule is a game changer for healthcare providers, but i also think for all patients. the last thing i want them to be worrying about is the obstacle to actually get the medication at the pharmacy. tech based really changes the way that we access healthcare. i think it makes it easier, i think it breaks boundaries. i personally have so many patients who love capsule because it has changed their life. experience a better pharmacy.

what the world needs now... is people. people who see healthcare a little bit differently. where technology helps doctors provide more precise care... leading to faster, better outcomes and puts improved health in all of our hands. because seeing a healthier world isn't far in the future. we're building it... now. ge. building a world that works. welcome back it has been kind of under the radar, but it shouldn't be the dollar has been rising over the past month by nearly 2%. it could have a big impact on some of the big companies that do bust neciness that do compan all over the world let's bring in seema mody for the impact >> kelly, strategies across wall

street examine which companies are at risk. it is said that technology and energy are the most vulnerable with half of their sales outside the u.s. the stronger dollar, remember, makes their products more expensive overseas and pressures profits. within technology, chip stocks like nvidia, texas instruments, over 70% of revenue internationally according to goldman. industrials are also high on the list after years of expanding overseas and in new markets, research says 3m is the most exposed with its presence in emerging markets they were downgraded by jpmorgan to neutral overweight. the stock is down about 9% in the past four weeks. taking a step back though, kelly, the dollar strength supply chain constraints, the ongoing uncertainty around china, there's a cost to going global, right? one question portfolio managers are trying to answer, do companies start to rethink their plan to diversify?

the percentage of foreign sales, in fact, of big u.s. companies has come down in recent years, and oppenheimer says it is due to the dollar, geopolitics, covid as well. the market though starting to take note of this in recent weeks. look at the s&p 500. it has been underperforming the small cap index which has more of a domestic tilt that's a one-month chart right there, kelly >> a great point there's also commodities if we look at a day like today if you have crude rising with the dollar rising as well, it is almost like it has twice the umph it would otherwise if it was the flip side of a sinking currency >> and it is these type of market dislocations when you can't provide an exact narrative as to why the commodities. opec we know is a big part of the story today, but, yes, the fluctuations, the broader implication on not just commodities. big companies like schlumberger, over 55% of its sales outside the u.s. it is these type of oil, energy, mining giants that have now so

much more to think about, right, not just what is going on in china. >> absolutely. seema, thank you very much seema speaking of the dollar, a big interview coming tomorrow on cnbc treasury secretary janet yellen joining "squaks box" at 7:30 eastern time someone remind me. coming up on "the exchange" a dangerous type of cyberattack you don't see coming and can't buy your way out of. plus, a former high-flying stock that lost nearly half of its value on the year. the dow down just shy of 400 points we are back in a moment as we monitor the sell-off

you founded your kayak company because you love the ocean- not spreadsheets. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

♪ ♪ welcome back to "the exchange." zero day attacks are considered some of the most destructive cyberattacks as hackers exploit a flaw in a system with malware before developers can patch the vulnerability. according to mannedy, zero day attacks are hitting record highs. through july they broke the previous record set in 2019 and we're on pace to double the number of attacks from each of the last two years what can be done to prevent malicious actors our own eamon javers is here

with an exclusive interview. eamon. >> reporter: that's right. i'm here with kevin mandia thank you for being here you guys are having a big week you have a big conference in washington, d.c. this week and a new ticker symbol that storts tomorrow what will it be? >> mndt. it is kind of mandiant existed from 2004 to about 2014. we were bought by fire eye and we felt the best thing for both organizations i guess at seven years later, to take fire eye products, bought by symphony technology group we divestiture a few months ago we are trying to defend our customers and take our expertise and intel and frontline experience and close the security gap >> you see a roll-up in cybersecurity, it might be a roll-out in cybersecurity as you separate the two companies again? >> absolutely. we had to separate

mandiant has been controls agnostic, we work with any end point company. our goal is to defend our customers. beyond that, defend critical infrastructure for nations >> let me ask you about a big headline over the weekend. it was very early, you my not know about it just yet but we saw this pandora papers leak of thousands and pandora pa of thousands of documents. there is fascination about the wealth of people around the world, fraud that happened one question is going to be who doesn't it what would you do if you were trying to find ow who kind of person it would be who would leak that? >> we have to look at everything that was leaked, where did it come from, how would you collect that information, what expertise did it take. look at the source, where did it originate from was it a cyber component or was it somebody from the inside, maybe had 25 30rks different

sources. so you get an origin, and then how was it looked, ttps, tools, tactics and procedures on how you disseminated or laundered that information to the press. >> do you think we will ever know who did it? >> that's an excellent question. i think people will investigate. it is too soon to know the probability of the outcome of that investigation. >> one thing you said this year is we are seeing a record number of zero days. >> right. >> the toughest to attack inside terms of cyber security. zero day means the defending company has never seen this type of attack before what are the numbers looking like why are we seeing this >> there is no patch for them. a zero day is going to work if you have vulnerable software n. 2019, you saw 32 zero days deployed that means somebody exploited those zero days and gained access to the network we saw 30 in 2020. we are already up to 46 in 2021.

>> 64? these are expensive, right. >> yes. >> if you are on a dark web and you want to buy a zero ay, which you can do, it is not creep? >> it can be hundreds of thousands of dollars but here's the catch, if you are making millions via intrusions via ransomware or extortions or some other kind of attack there is an investment case, if you have a zero day you will use it against the high-value targets, those that if you do get into their networks and extort them, maybe they are an industry more likely to pay. maybe the information that you steal their risk quakes or their analysis will be cheaper to pay the ransom. >> seems like its a well capitalized group of bad gigs who have a lot of cash to spend to go after even bigger pots of cash and the cash is coming from the americans paying the ransoms in the first place. it is a self fulfilling ecosystem. >> i don't think the default

answer by any of the ceos is let's just pay the ransom. people start with a default no we have the technology and the skills to prevent the problem. at our conference this week we are talking to government igs officials about how to have diplomacy and a coordinated national response. nobody likes ransomware except the ransomware actors. >> you have been researching the german election. tell me what you saw there. >> bottom line, we noticed a group that we referred to as ghost whiter a couple years ago. and they were posting anti-nato sentiment years ago. this was a group that combines several operations they don't just hack they also do information operations sometimes it's a group that compromises networks and a whole different skillset to nunes people, lie or influence the hearts and minds of people

ghost writers group does both, they will compromise and change content to near truths, false truths. >> were they doing that in germany? >> they were we gave notice to folks over there to let them know. >> you alerted the german government >> we did. >> were they able to put a stop to it? >> it is hard for anyone to be omniscient whether they stopped all activities you are aware in cyberspace, are we aware of 98% of what the bad guys do? or 2%? it is closer to 2% on any given day. >> hacks, lies, you live in an interesting world. cally, i will toss it back to you. >> eamon javers with kevin manned yant today. let's look at the cyber stocks hack etf is underperforming the markets. crowd strike up 11%. a outperformer has been palo alto networks up 32% it more than tripled since the march 2020 lows.

let's check on the nasdaq right now. a tech wreck, down 2.3%. facebook is leading the way lower with a decline in the range of 5 to 6% we will speak with a formeter ch high flyer about this fall from flavor that lost has its favor that's next. in her clear blue skies. the legends she births on home town fields. and the future she promises. when we made grand wagoneer, proudly assembled in america, we knew no object would ever rank with the best things in this country. but we believed we could make something worthy of their spirit.

- [narrator] introducing the grubhub guarantee:

our promise to deliver the food you love on time, and give you the lowest price, or you'll get $5 off your next order. we love our house, been here for years. yeah. but there's an animal in the attic. (loud drumming) yeah yeah yeah yeah!!!! (animal drumming in distance) (loud drumming) drums! drums! aaaaaahhhh! at least geico makes bundling our home and car insurance easy. we save a lot. aaaaaahhhh! ohhh! (loud drumming) animal! aaaaaahhhh! for bundling made easy, go to geico.com. uh-oh...

welcome back, everybody. smars of palantir are lower, down 4.5%. look at that peak to trough declient down by almost 50% from their high this is year, the company announcing a small deal today, but it could potentially lose a much larger government contract. josh lipton is here with more. >> we got news out of palantir today as well. the data miner announcing it extended its contract with the nih. it is worth $60 million over two years. the team at william blare believes the committee willed secured an extension of an existing contract with the d.a the stock down, down 50 frrz the

january high palantir making its public debut in september of 2020 it is still up 150% in the past 12 months. there have been reports that the company might lose a contract with i.c.e analysts say it wouldn't be fanlly material even if that rumor is true. what does impact the stock the stock got caught up in the meme stock craze and hit levels it should not have even as the frenzy cools the stock still looks pricey brent till at jefferies is a bull on this name. palantir is working hard to bring technology to the mass market if successful, he says, palantir will see sustained commercial growth that will change the stock price for the better >> have concerns passed for now about its key government

contracts? >> when you look at it broadly, it's coming under pressure for a lot of reasons one would be fading pandemic tail winds that is a question on the street that some financial analystings have they will say government business saw a huge growth during the pandemic but what happens post pandemic. pal intear will contract it is winning business and contracting with government agencies. that does it for "the exchange." thanks, everybody, for tuning in "power lunch" begins right now indeed it does, kelly. welcome, everybody, to "power lunch. here's what we have got in store today. steep losses to start the week which stocks have you not buy but avoid. we will talk to a market strategist who has list of names including blue chips you may already own. blue skies ahead bark close turns bullish on the airlines, prefers some stocks over others. we will tell you which they are