CEO Daily: Wednesday, 2nd November

I’m in San Diego this morning, for the inaugural Fortune Brainstorm Health conference, which is providing a fascinating glimpse into the future of health care. Yesterday’s sessions ranged from an exhilarating look at how big data and artificial intelligence can improve cancer diagnoses to a disturbing discussion of how unprepared we are for the next pandemic, and included a demonstration of how virtual reality can reduce pain and a meditation session with Deepak Chopra.

But my favorite session of the day was my colleague Cliff Leaf’s interview with Nobel Laureate Elizabeth Blackburn. She has done breakthrough research on telomeres, which are little caps at the end of our DNA that wear away with age. Her work has provided a scientific window into the aging process, and how to slow it down.

Her conclusion? “Essentially what your mother told you: exercise, sleep well, have a good attitude, and eat decent food.”

You can read more from the conference here .

More news below.

Top News

• Markets Multiply the Brexit Effect by the Trump Factor

Financial markets have the jitters. A couple of nationwide polls that put Donald Trump ahead of Hillary Clinton have pushed the S&P500 down to a five-month low and the dollar down to a three-week low. Nationwide polls have limited usefulness in the U.S. electoral system, and state-wide polls still give Clinton the advantage. Stats guru Nate Silver considers Trump “an underdog, but no longer a longshot,” but markets are in no mood to repeat being caught off-guard as they were by the Brexit referendum. German government bonds, Treasurys and—inevitably--gold are all benefiting.  Fortune

• Fed Set to Keep Its Head Below the Parapet

The Federal Reserve will announce its monetary policy decisions later, and is widely expected to leave interest rates unchanged rather than add to the spike in market volatility. Data out yesterday broadly kept the case for an interest rate rise in December intact, with the ISM Manufacturing index rebounding from October’s shock contraction, and indicating higher output and price levels. For the doves, there was the news that construction spending fell 0.4% in September, and a slew of auto sales data that showed a gradual slowdown taking shape. There was also a further drop in oil prices, which will, at a minimum, strengthen the case for doing nothing today. Fortune

• Valeant’s Fire Sale

Weighed down by debt, Valeant Pharmaceuticals confirmed it’s in talks to sell its gastroenterology drug Salix, which it bought for $11.1 billion last year. The Wall Street Journal said Takeda Pharmaceutical was the likely buyer, something Valeant didn’t confirm. The WSJ also suggested a price of $10 billion, which would imply a $1.1 billion loss on the asset. Valeant had told investors in August it was only looking to sell $8 billion of non-core assets, so the Salix sale smells strongly of problems bigger than management was aware of at the time. But by putting a price on one of its underlying businesses, it does at least make it harder for the stock market to discounting it as aggressively as it currently does. Fortune

• Microsoft Bemoans Hack, Takes on Slack

Microsoft admitted that a hacker group linked to Russia and to recent breaches of U.S. political parties and campaigns had been among those exploiting a security flaw in Windows that was disclosed by Google Monday without the Redmond-based giant’s permission. Hackers had gained a foothold in people’s computers by exploiting an unknown flaw in Adobe Flash—a bug that Adobe patched last week. To raise company (and customer) spirits, Microsoft is expected to launch its answer to the popular team-messaging app Slack this week along with the (previously announced) roll-out of a new mobile development toolkit.  Fortune

Around the Water Cooler

• Chipotle’s Ells Gets a Grilling

Chipotle Mexican Grill’s founder and co-CEO Steve Ells is under increasing pressure. Two union-affiliated shareholders, Amalgamated Bank and CtW Investment Group, said Tuesday they wanted to replace him as chairman with an independent director. Any vote on the proposal wouldn’t take place until next year’s shareholder meeting, but the revolt against a management that has overseen a near-60% drop in the share price while paying itself handsomely is clearly gathering steam. New York City Comptroller Scott Stringer, who oversees a pension fund that owns Chipotle shares, immediately backed the new proposal, and CalPERS also made approving noises. It’s all grist to the mill of Bill Ackman’s Pershing Square, which disclosed a 9.9% stake in September. Fortune

• Herbalife’s CEO Is Stepping Down

On the subject of Ackman, Herbalife said CEO Michael Johnson would step down next year after 13 years at the helm. Most of that was spent in a life-or-death struggle with Pershing Square, from which Johnson emerged bloodied, but unbowed, as the saying goes. Johnson’s White Knight, Carl Icahn, said he fully supported the board’s choice of COO and former CFO Richard Goudis as Johnson’s successor. He takes over at the start of a new chapter for Herbalife, which settled an Ackman-inspired FTC probe into its sales practices in July for $200 million. It said yesterday that net income fell 6.3% year-on-year in the three months to September. Fortune

• Big Oil, India Throw Billions at Green Projects

One of the biggest factors behind the spread of renewable energy is the rapid expansion in its funding sources. Two cases in point: Reuters reported Wednesday that seven major oil companies, including Saudi Aramco, Royal Dutch Shell, BP and Total, will announce on Friday a new joint investment vehicle to cut carbon emissions, promote renewables and improve energy efficiency. Meanwhile, the Indian government is launching a $2 billion equity fund for renewable energy companies to help it deal with problems that owe as much to pollution and energy shortages as to Climate Change. The moves are timed to create a buzz ahead of the COP22 conference in Marrakesh next week, underlining their authors’ commitments to the Climate Change goals agreed in Paris last year. Reuters

• Gannett Drops Its Bid for Tronc

Gannett, the publisher of USA Today, finally admitted defeat in its pursuit of Tronc, the company behind the Chicago Tribune and the Los Angeles Times. Tronc, which had some explaining to do to upset shareholders, said it had agreed a sale price with Gannett in September, but had been informed that Gannett couldn’t get its financing together and consequently withdrew its approach. Tronc shares ended down 12.4%, ominously below the level they were at before Gannett made its move in June. Gannett’s shares rose 1.9%. Fortune