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Here's a free business lesson courtesy of Sir Isaac Newton: for every action there must be an equal and opposite reaction.

As Russia wages cyber warfare on Ukraine as part of its invasion, governments and companies around the world -- especially those involved in critical infrastructure -- are scrambling to beef up their cybersecurity profiles. As a result, cybersecurity stocks are the new hot ticket.

War In The Digital Age

In Ukraine, some government websites have been struck by denial-of-service attacks, where hacker-directed bots are used to bring down websites by overwhelming them with traffic. But an even greater concern is destructive "wiper" malware being discovered in Ukraine that deletes data from infected computers and can render them inoperable. The FBI and Cybersecurity and Infrastructure Security Agency warned American companies to have their "shields up on the weekend," and when markets opened Monday all security firms had to do was reap the rewards:

  • The Global X Cybersecurity ETF, which tracks the sector, rose 3.8% on Monday, and is up over 12% through the past three sessions. In comparison, the tech-dominated Nasdaq 100 was only up 0.3%.
  • CrowdStrike, which discovered Russian hackers meddling in the DNC's servers in 2016, saw its stock drop 18% from January 1 to February 23, the day before Russia invaded Ukraine. Since then, its stock has jumped over 20%.

Trouble For Toyota: After a suspected cyber attack hit one of its largest parts suppliers, Toyota shut down its Japanese factories Monday. The origin of the attack is still unknown, though senior Japanese officials told the Financial Times they fear it was Russian retaliation for the nation's support of Ukraine.

If Not Now...: "The cyber market is just beginning and a little cyber war will cause the market to be much, much bigger," Shlomo Kramer, chief executive of cloud security firm Cato Networks, told the Financial Times. "There needs to be enough pain before the market can jump to the next level. I don't know if this is the conflict that will create this, but sooner or later one will."