Very strong. A steam engine of the same dimensions and materials as a internal combustion engine has much, much greater torque. This is due to the fact that pressure is exerted over the whole of the piston stroke. If anyone has ever seen one of these small ride on steam trains pull out of the station they will appreciate this. As pointed out above the arm can only be as strong as the body supporting it, although a hand could be more useful, an unbreakable grip might come in hand clutching a rope, for example.
Most probably there would have to be a backpack, as even very small 'flash steam' boilers are quite bulky for their power output, and they operate at very high temperatures, so not the best thing to carry around stepped to your back. If, however, a catalyst is used to produce steam from hydrogen peroxide (H_2O_2) then the apparatus could be contained within the arm, the tanks and reactor built into the bones, perhaps. As the reaction also releases oxygen brass, copper, and bronze would be used, so it fits the aesthetic. Superheated water also releases quite a lot of energy, releasing many times its own volume of steam, so that is another option that could fit into the arm. The last two options would also be cooler in operation, increasing the ability for the cyborg to go unnoticed.
While pistons and cables wrapped around gears at the joints seems the most logical 'muscle' it would be possible to make some variation of 'pneumatic muscle', a tube that shortens in length as it is inflated by the steam, would be more realistic as far as appearance goes. It would, however, have give that a direct piston or hydraulic design might lack, although they can have springs added to compensate.
So what can he do? Given adequate support where the arm is attached he could support his own weight indefinitely, especially if a locking mechanism is included. Crush people's hands and bones fairly easily I would think, although bone is remarkably strong. Probably do the same to light metal pipes. Also, as the hand is metal, and presumably cannot feel pain, can punch much much harder than a normal human.