Water Heaters - My vent flows backwards

I have a new hot w/htr and the vent goes through my basement wall and then up for about 2 feet with a rain cap on it. I just noticed that it is not venting but pushed out where the raised vent connection is on my heater. It gets so hot I around the top of the heater that this also concerns me. What can I do to get this thing to go out of the house instead of backing up on me? I have photos which would help you see what I have but I don't know how to let you see them. I'm a new subscriber here.
Thanks for any help, I think I need it fast. OhioPicker

the vent goes through my basement wall and then up for about 2 feet with a rain cap on it. I just noticed that it is not venting but pushed out where the raised vent connection is on my heater. It gets so hot I around the top of the heater
Id turn it off till you get this fixed for sure If you dont the carbon monoxide can get you. This will not pass any code thats for sure. That vent pipe outside has to go up pass the roof line. Also if again the wood wall has to be a gas B vent pipe. SO TURN THE HEATER OFF NOW

ED ;)

My vent goes through the block wall, it doesn't touch any nor is near any wood. When I go out of the wall to go up above the roof does it matter that it will be exposed at least this winter and get cold perhaps not allowing the vent to work? Should I put a cap on it?
Thanks - larry

Yes you have to put a cap on it that B gas vent pipe has a cap for it. Yes the pipe can be outside.But it has to go up past the roof line.

Thanks for the information Ed. Now that I know what is needed I'll get on it today. ( even if it is freezing out there ) larry