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No Biden mention, glosses over Covid deaths, Capitol riot

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President Donald Trump in a prerecorded farewell address touted his record on the economy and foreign policy, while glossing over the Capitol riot that consumed the final weeks of his presidency.

He also failed to mention his successor, Joe Biden, by name. Biden will be inaugurated as the nation’s 46th president Wednesday.

Trump’s nearly 20-minute speech, which was taped Monday, framed his departure from the White House as the natural conclusion of a job well done, rather than as the consequence of his election loss to Biden.

“We did what we came here to do — and so much more,” Trump said in the address.

“This week, we inaugurate a new administration and pray for its success in keeping America safe and prosperous. We extend our best wishes, and we also want them to have luck — a very important word,” Trump said.

Trump has previously acknowledged that a new administration will take charge on Wednesday, but he has not formally conceded to Biden. Unlike past presidents’ farewell speeches, Trump’s address makes no specific mention of his successor.

The president’s speech also made just one reference to the Jan. 6 invasion of the Capitol by a swarm of his supporters — an event that left five dead and spurred the House to impeach him for a second time.

“All Americans were horrified by the assault on our Capitol. Political violence is an attack on everything we cherish as Americans. It can never be tolerated,” Trump said in the speech.

He has denied any responsibility for the invasion. But earlier Tuesday, Senate Majority Leader Mitch McConnell, R-Ky., said that the mob was “provoked by the president and other powerful people.”

Trump faces an impeachment trial in the Senate.

Trump in the video praised his administration’s efforts to combat the coronavirus pandemic, saying the U.S. “outperformed other countries economically because of our incredible economy and the economy that we built. Without the foundations and footings, it wouldn’t have worked out this way.”

Earlier Tuesday, the U.S. topped 400,000 deaths from Covid, according to data compiled by Johns Hopkins University. Roughly one-quarter of those deaths were reported in the last five weeks alone.

“We grieve for every life lost, and we pledge in their memory to wipe out this horrible pandemic once and for all,” Trump, whose term ends Wednesday, said in his address.

Trump, who regularly accused media of being “the enemy of the people” and campaigned on a promise to “drain the swamp” in D.C., also dedicated a sizeable portion of the address to warning against “political censorship and blacklisting.”

“Shutting down free and open debate violates our core values and most enduring traditions,” said Trump, who was permanently banned from Twitter following his initial reaction to the riot at the Capitol.

“Now, as I prepare to hand power over to a new administration at noon on Wednesday, I want you to know that the movement we started is only just beginning,” he said.

But it’s unclear whether that movement will include Trump — at least as a candidate for elected office. Senate Minority Leader Chuck Schumer, D-N.Y., vowed earlier Tuesday that if Trump is convicted after his impeachment trial “there will be a vote on barring him from running again.”

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Lockdowns after China’s new Covid-19 outbreak impact steel, iron ore

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This aerial image taken on June 6, 2019 shows a steel factory in Chengde, China’s northern Hebei province.

FRED DUFOUR | AFP | Getty Images

SINGAPORE — A new wave of Covid-19 cases in China’s Hebei province triggered transport restrictions in the major steel-producing region.

The lockdowns in Hebei include areas surrounding steel mills, limiting the ability to transport the metal to customers. China is the world’s top steel producer and analysts say Hebei contributes over 20% of the country’s total output.

Coronavirus cases in Hebei have been rising since the start of the year, prompting the province to lock down its capital, Shijiazhuang, and at least two other areas in an effort to contain the spread of the coronavirus.

The curbs are unlikely to affect steel production for now, but they could hurt demand by spurring the manufacturing sector to stop work earlier than planned ahead of the major Lunar New Year holiday, commodity data provider S&P Global Platts said earlier this month.

Demand and prices for raw materials used to make steel like iron ore could also shoot up, according to analysts.

Restrictions in Hebei

Steel deliveries by truck have been suspended in Hebei, leaving rail as the only way to transport steel, Shanghai-based Chinese metal data provider Mysteel said in a note last week. The report said blocked roads have led to completed steel piling up at major mills in the region.

“Partial lockdowns have restricted the transportation of goods, resulting in a sharper build in inventories held by local steel mills rather than at stockists in the first half of January,” said Atilla Widnell, co-founder of Singapore-based Navigate Commodities, in an email to CNBC on Monday.

“We have heard anecdotal evidence that some stockists and traders are reluctant to tie up cash flow in-case a ‘soft lockdown’ is prolonged or intensified,” he added.

S&P Global Platts said inventories are rising at the Jingye Iron & Steel mill in Hebei’s capital city Shijiazhuang. The firm cited a source at the mill, which produces 13 million metric tons of crude steel a year.

Manufacturing, construction sectors stopping work

Manufacturing and construction sites in China are set to stop work earlier than usual ahead of the Lunar New Year holiday between Feb. 11 and 17. That’s likely to hit demand for steel, which is heavily used in those sectors.

The government advised manufacturing and construction workers to return home before the peak holiday travel period, said S&P Global Platts.

“According to market sources, Beijing has done this in (an) effort to reduce the possibility of a spike in COVID-19 cases during and after the Lunar New Year holidays,” the firm wrote.

Work stopping earlier suggests steel demand is set to drop, causing inventories to rise elsewhere.

“Some traders said they were unwilling to increase their steel inventories as they anticipate having to hold on to these for much longer than usual, and with steel prices continuing to soar, building inventories will put pressure on their cash flows,” S&P Global Platts added.

Impact on steel, iron ore

Daniel Hynes, senior commodity strategist at Australian bank ANZ, told CNBC on Monday that risks could spread to iron ore.

“There are concerns that a further rise in coronavirus cases in Hebei could result in some steel making regions being locked down. This would obviously impact demand for iron ore, as steel mills would likely see supply chains disrupted, thus impacting steel production,” he said in an email.

The ripple effects can already be seen in the costs for raw materials used to process steel like coking coal, said energy research consultancy Wood Mackenzie.

Coking coal prices are surging and are about 450 yuan per ton higher than last year, according to Zhilu Wang, research associate at the firm.

“This is due to the restrictions on inter-provincial transportation in Hebei provinces which has resulted in the increase of transportation fee,” said Wang.

While this could in turn support steel prices, Wang predicted it could mildly weaken overall as traders stock less of the commodity due to the Covid uncertainty.

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China loan prime rates, coronavirus, currencies

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SINGAPORE — Stocks in Japan were set to trade higher at the open as investors in Asia-Pacific wait for the release of China’s latest benchmark lending rate.

Futures pointed to a higher open for Japanese stocks. The Nikkei futures contract in Chicago was at 28,755 while its counterpart in Osaka was at 28,700. That compared against the Nikkei 225’s last close at 28,633.46.

Meanwhile, shares in Australia edged higher in early trading, with the S&P/ASX 200 up about 0.5%.

In Southeast Asia, stocks in Malaysia will be closely watched following reports that almost all states in the country will be placed under Movement Control Order from Friday as the government seeks to curb the spread of the coronavirus.

Investor focus on Wednesday will likely be on China’s benchmark lending rate, expected to be out at around 9:30 a.m. HK/SIN. A majority of traders and analysts in a snap Reuters poll predict no change to either the one-year loan prime rate (LPR) or the five-year LPR, which were last sitting at 3.85% and 4.65%, respectively.

Currencies

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 90.476 following an earlier high above 90.7.

The Japanese yen traded at 103.87 per dollar, having weakened from levels below 103.8 against the greenback yesterday. The Australian dollar changed hands at $0.7706, still off levels above $0.775 seen last week.

Here’s a look at what’s on tap:

  • China: One year and five year loan prime rates at 9:30 a.m. HK/SIN

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