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Biden Gets U.S. Into Vaccine Diplomacy Race as Stockpiles Rise

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Author of the article: Bloomberg News David Wainer and Josh Wingrove (Bloomberg) — Through the early months of global vaccinations against Covid-19, the U.S. hoarded shots while China, Russia and others distributed doses to desperate nations throughout the world. That’s starting to change. Vaccine shipments from the U.S. have begun, as domestic supply increasingly outweighs…

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David Wainer and Josh Wingrove

(Bloomberg) — Through the early months of global vaccinations against Covid-19, the U.S. hoarded shots while China, Russia and others distributed doses to desperate nations throughout the world.

That’s starting to change.

Vaccine shipments from the U.S. have begun, as domestic supply increasingly outweighs demand. That’s allowed President Joe Biden to pivot to the role of vaccine statesman after months of refusing to do what Europe, India, China and Russia have done: export a portion of their vaccines before domestic demand was fully met.

Biden vowed Tuesday that the U.S. will be an “arsenal for fighting Covid-19” globally, including by giving away 60 million doses of AstraZeneca Plc’s shot while the nation’s vaccine factories churn out others.

“It’s a significant humanitarian commitment,” Biden said. “We’re going to move as quickly as we can to get as many doses of Moderna and Pfizer as possibly can be produced, and export those around the world.”

The shift comes at a critical time. After more than 3.2 million deaths, the world is confronting a new wave of Covid-19 infections, despite about 1.2 billion shots having been given, according to Bloomberg’s vaccine tracker. Brazil has exceeded 400,000 confirmed deaths, with little end in sight, while India’s surging case load of 20 million prompted the U.S. to restrict travel from the world’s second-most populous nation.

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Developing nations including Argentina, Mexico and India have clamored for American vaccine help. While the U.S. is one of the world’s major producers, it’s exported only a few million shots so far compared with 217 million doses shipped from China, 94 million from the European Union, 67 million from India, and about 12 million from Russia, according to Airfinity, a science information and analytics company.

The Biden administration on Monday backed Pfizer Inc.’s move to begin exporting U.S.-made doses of its coronavirus vaccine. Meanwhile, India, South Africa and other countries are continuing to press the U.S. to ease intellectual property protections for Covid-19 vaccines.

The U.S. focus on vaccinating its population first has paid off, allowing it to shift some attention abroad just as more transmissible mutations of the virus gain a stronger foothold. While India, China and Russia got a head start on vaccine diplomacy, they now lag well behind the U.S. in inoculating their own populations, according to the Bloomberg Vaccine Tracker — a choice that has proved especially costly for India.

Despite sending vaccines abroad, Russia has only inoculated about 20% of its population, who are increasingly skeptical about taking the shot. Meanwhile in Hong Kong, citizens sought out the Pfizer-BioNTech vaccine at a faster rate than China’s Sinovac, which has been reported to be less effective. And even Europe found itself under heavy criticism for not exporting vaccines initially before reversing course.

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The U.S. contribution to global efforts will be modest at first, focused on accelerating deliveries of vaccine-related supplies to India as well as distributing some of its growing stockpile of shots. Biden said Tuesday that by July 4, his goal is to have sent “about 10% of what we have to other nations.”

Vaccinations Decline Across U.S., Spurring Search for Holdouts

The president’s first key question is how to divide up initial shipments of as many as 60 million unused AstraZeneca Plc vaccines already produced and awaiting a safety review. The shot hasn’t been authorized for use in the U.S. and with abundant supplies of three other vaccines, may never be needed domestically.

Biden has said that he intends to send at least some AstraZeneca doses to India, while also hinting at help for Canada, Mexico and nations in Central America. But the U.S. has fielded requests from countries around the world seeking whatever vaccines they can get.

“There is huge demand for vaccine all over the world,” Gayle Smith, the State Department’s global Covid response coordinator, told reporters Friday. “We have not made a decision yet as to criteria for allocating those vaccines.”

Besides representing a vote of confidence in rising U.S. vaccination rates, Biden’s decision to begin exports will be a signal that the U.S. is pushing back against Russian and Chinese efforts to enhance their so-called soft diplomatic power by distributing shots to strategically important regions — including many nations in the Western Hemisphere.

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“The U.S. needs to find a way to get credit for this given the Chinese and Russians are busy doing this right now,” Thomas Shannon, a former under secretary of state for political affairs, said in an interview.

Hong Kong Vaccine Rollout Hampered by Reliance on Chinese Shots

Biden has already taken three key steps to fuel global supply. One was a partnership with the other so-called Quad nations — Australia, Japan and India — to boost vaccine manufacturing in India through 2022. Another was arranging a partnership between Merck & Co. and Johnson & Johnson to increase production of the J&J shot.

That deal won’t substantially ramp up production until late 2021, well beyond the point when the U.S. expects to have vaccinated its entire willing adult population, meaning it’s likely to increase exports.

Biden has also pledged $4 billion to Covax, a global vaccine procurement initiative.

Vaccine Surplus

Under both former President Donald Trump and Biden, the U.S. ordered hundreds of millions more doses than it could use, part of a strategy to hedge its bets on which company would produce a successful vaccine and to ensure sufficient supply for children and potential booster shots. The U.S. orders have been accompanied by legal constraints on exports of doses provided to the administration.

In a report last month, Duke University researchers predicted the U.S. may have 300 million excess doses by the end of July, though that was before some production issues slowed output.

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“The deep investment in ensuring availability in the U.S. has paid dividends,” Krishna Udayakumar, one of the authors of the Duke report, said in an interview. “The U.S. government can now start prioritizing the global perspective.”

Aid groups want the U.S. to take a more dramatic step than simply allowing exports by also leaning on manufacturers to share intellectual property behind their shots so that low-income nations can make the vaccines themselves. U.S. trade chief Katherine Tai met last month with key officials at Pfizer and AstraZeneca to discuss a proposed waiver of intellectual-property protections floated by India and South Africa.

“The Biden administration needs to do more to pressure the domestic industry to participate in tech-transfer initiatives,” said Kate Elder, senior vaccine policy adviser at Doctors Without Borders’ Access Campaign.

But the administration has been cool to the proposal so far, and Biden said Tuesday he hasn’t yet made a decision. Some of Biden’s senior advisers have argued publicly and privately that vaccine patents aren’t useful without manufacturing expertise, capacity and drug ingredients, and that the administration’s goal is boosting supply of vaccines overall.

After moving in fits and starts, White House National Security Advisor Jake Sullivan said Friday that the U.S. plans to elaborate on a “fuller strategy” in the coming weeks.

“We fully recognize that there is an urgent need for the U.S. to step up to the plate to deliver for the world to end this pandemic and then help to recover from this pandemic,” Sullivan told the Aspen Security Forum. “Vaccines are a part of that, and our 60 million AstraZeneca is a step –but billions of doses ultimately are needed, and that’s going to mean manufacturing logistics and getting shots in arms.”

©2021 Bloomberg L.P.

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In-depth reporting on the innovation economy from The Logic, brought to you in partnership with the Financial Post.

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Asian Stocks Erase 2021 Gains on Concerns Over Inflation, Virus

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Author of the article: Bloomberg News Min Jeong Lee (Bloomberg) — Asian stocks dropped, with the regional benchmark briefly erasing its gains for the year, as mounting worries over inflation and a resurgence in Covid-19 cases soured investor sentiment. The MSCI Asia Pacific Index slid as much as 1% and was down 0.9% as of…

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(Bloomberg) — Asian stocks dropped, with the regional benchmark briefly erasing its gains for the year, as mounting worries over inflation and a resurgence in Covid-19 cases soured investor sentiment.

The MSCI Asia Pacific Index slid as much as 1% and was down 0.9% as of 12:52 p.m. in Tokyo, tracking losses in American shares after data on Wednesday showed U.S. consumer prices climbed in April by the most since 2009. The Asian gauge has now fallen more than 9% from a Feb. 17 peak.

Tech stocks have been at the forefront of a selloff in global equities this week as an explosive rally in commodity prices threatens to push up inflation. Asia’s tech shares, which are contending with higher U.S. bond yields and stretched valuations just like their global peers, have also been hurt by regulatory tightening in China. Further, a fresh surge in infections in several countries including India, Japan and parts of Southeast Asia is weighing on regional stocks.

“We need to kind of price in a more normal interest-rate environment, more normal inflation environment,” said Ken Peng, head of Asia investment strategy at Citigroup Inc.’s private-banking arm. “The shake up could last a while longer. But I’m still not too worried because, growth will comeback to be the most important element once interest rates normalize.”

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Technology and communication services were the worst-performing sectors on the Asian gauge Thursday.

Japanese shares declined for a third day on Thursday, while stocks in China snapped a two-day winning run. Markets in Singapore, India, Indonesia, Malaysia and the Philippines were shut for a holiday. In Taiwan, the benchmark stock index extended losses after slumping the most since March last year on Wednesday partly due to concern over tightening of virus-linked restrictions.

SECTORS TO WATCH

Stocks linked to cryptocurrencies fell in line with the slump in Bitcoin, after Tesla Inc. Chief Executive Officer Elon Musk expressed concerns over its energy usageTraditional Chinese medicine firms advanced as President Xi Jinping called for the development of the treatments after experience gained from COVID-19

MARKETS AT A GLANCE

Japan’s Topix index down 0.6%; Nikkei 225 down 1.8%Hong Kong’s Hang Seng Index down 1%; Hang Seng China Enterprises down 1.2%; Shanghai Composite down 0.7%; CSI 300 down 0.8%Taiwan’s Taiex index down 0.7%South Korea’s Kospi index down 0.5%; Kospi 200 down 0.7%Australia’s S&P/ASX 200 down 0.6%; New Zealand’s S&P/NZX 50 down 1.1%Thailand’s SET down 1.4%; Vietnam’s VN Index down 0.2%

ADVANCERS

Seven & i Holdings jumped as much as 7.4% in Tokyo as ValueAct Capital disclosed the acquisition of a 4.3% stake in the operator of convenience storesKirin rose as much as 4.3%, the most since Nov. 16, after the Japanese beer maker beat quarterly profit expectationsChina Mengniu Dairy jumped as much as 5.4% after Danone finalized its HK$15.4 billion ($1.98 billion) sale of approximately 9.8% stake in MengniuGrainCorp added as much as 8.3%, the most since Nov. 13, after the Australian agricultural company raised its FY earnings forecastHanwha Life Insurance surged as much as 8.7% after its 1Q report showed earnings jumped nearly four foldNTT climbed as much as 2.8% after the telecom giant’s quarterly profit and forecast for the current fiscal year beat analyst estimates

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DECLINERS

SoftBank Group declined as much as 6.7% as its record quarterly profit failed to impress a market reeling from a global selloff in tech stocksGongniu Group dropped as much as 9.7% in Shanghai after the company said it was under investigations by local authorities for monopolistic behaviorPerenti Global tumbled as much as 28%, the most since March 2020, after the Australian mining services company cut its guidanceChina Evergrande New Energy Vehicle Group sank 8.7% in Hong Kong after its parent sold 260m shares at HK$40.92 apiece, a 20% discount to last closeNexon slid as much as 17% after the game developer forecast as much as a 19% y/y decline in operating profit in 1H

©2021 Bloomberg L.P.

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Gold up on hopes for continued low rates, firm yields cap gains

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Author of the article: Gold edged up on Thursday on hopes that the U.S. Federal Reserve would not raise interest rates anytime soon, although a jump in U.S. Treasury yields following a strong rise in April consumer prices capped gains. Spot gold was up 0.2% at $1,818.22 per ounce by 0318 GMT, after falling more…

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Gold edged up on Thursday on hopes that

the U.S. Federal Reserve would not raise interest rates anytime

soon, although a jump in U.S. Treasury yields following a strong

rise in April consumer prices capped gains.

Spot gold was up 0.2% at $1,818.22 per ounce by 0318

GMT, after falling more than 1% in the previous session.

U.S. gold futures eased 0.2% to $1,818.80.

“We’re still getting on the aftershock of that consumer

price index release and the expectations now from the market

that the Fed will be forced to do something about inflation,” IG

Market analyst Kyle Rodda said.

The Fed, however, has been reiterating that inflation will

be so transitory that it won’t have to worry about adjusting

interest rates, he added.

Data on Wednesday showed U.S. consumer prices increased by

the most in nearly 12 years in April, intensifying concerns over

rising inflation.

Fed Vice Chair Richard Clarida said the twin surprises of

weak jobs growth and strong inflation in April has not dented

the U.S. central bank’s plans to keep its support for the

economy wide open.

Lower U.S. interest rates put pressure on the dollar and

bond yields, increasing the appeal of non-yielding bullion.

However, worries over rising inflation lifted benchmark U.S.

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10-year Treasury yields to their highest in more

than a month, while the dollar held firm.

“The stronger dollar and higher U.S. rates punished the

precious metals group (yesterday),” ED&F Man Capital Markets

analyst Edward Meir said in a note.

“Although we suspect that this weakness will prove to be

short-lived given rising inflationary expectations and a Fed

that at least for now, does not seem to be too eager to raise

rates.”

Palladium gained 0.9% to $2,882.69 per ounce. Silver

was steady at $27.04 per ounce, while platinum was

up 0.6% at $1,217.01.

(Reporting by Shreyansi Singh in Bengaluru; Editing by Rashmi

Aich and Vinay Dwivedi)

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Tesla’s Musk halts use of bitcoin for car purchases

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Author of the article: Reuters Hyunjoo Jin and Kanishka Singh Tesla Inc will no longer accept bitcoin for car purchases, Chief Executive Elon Musk said on Wednesday, citing long-brewing environmental concerns for a swift reversal in the company’s position on the cryptocurrency. Bitcoin fell more than 10% after Musk tweeted his decision to suspend its…

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Hyunjoo Jin and Kanishka Singh

Tesla Inc will no longer accept bitcoin for car purchases, Chief Executive Elon Musk said on Wednesday, citing long-brewing environmental concerns for a swift reversal in the company’s position on the cryptocurrency.

Bitcoin fell more than 10% after Musk tweeted his decision to suspend its use, less than two months after Tesla began accepting the world’s biggest digital currency for payment. Other cryptocurrencies, including ethereum, also fell before regaining some ground in Asia trade.

The use of bitcoin to buy Tesla’s electric vehicles had highlighted a dichotomy between Musk’s reputation as an environmentalist and the use of his popularity and stature as one of the world’s richest people to back cryptocurrencies.

Some Tesla investors, along with environmentalists, have been increasingly critical about the way bitcoin is “mined” using vast amounts of electricity generated with fossil fuels.

Musk said on Wednesday he backed that concern, especially the use of “coal, which has the worst emissions of any fuel.”

“Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at great cost to the environment,” he tweeted. Tesla shares fell 1.25% after hours.

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Tesla revealed in February it had bought $1.5 billion of bitcoin, before accepting it as payment for cars in March, driving a roughly 20% surge in the cryptocurrency.

Tesla would retain its bitcoin holdings with the plan to use the cryptocurrency as soon as mining transitions to more sustainable energy sources, Musk said.

Bitcoin is created when high-powered computers compete against other machines to solve complex mathematical puzzles, an energy-intensive process that currently often relies on electricity generated with fossil fuels, particularly coal.

At current rates, such bitcoin “mining” devours about the same amount of energy annually as the Netherlands did in 2019, the latest available data from the University of Cambridge and the International Energy Agency shows.

Analysts said Musk’s about-face was inevitable.

“The environmental impact from mining bitcoins was one of the biggest risks for the entire crypto market,” said Edward Moya, a senior market analyst at currency trading firm OANDA.

Meltem Demirors, chief strategy officer at digital asset manager CoinShares Group, said Tesla was unlikely to have sold many, if any, cars using bitcoin and the backflip generated positive publicity while simplifying payment processes.

“Elon was getting a lot of questions and criticisms and this statement allows him to appease critics while still keeping bitcoin on his balance sheet,” Demirors said.

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Mark Humphery-Jenner, an associate professor of finance at the University of New South Wales, said he was more concerned about Tesla management’s “very hasty and precipitous” decision-making.

Musk did not say in his Twitter comments whether any vehicles had been purchased with bitcoin and Tesla did not immediately respond to a request for comment.

CRYPTOCURRENCY SUPPORT

Some bitcoin proponents note that the existing financial system – with its millions of employees and computers in air-conditioned offices – uses large amounts of energy too.

Musk reiterated he remained a strong believer in cryptocurrencies.

“We are also looking at other cryptocurrencies that use

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