On Wall Street last Friday, the Dow Jones Industrial Average finished down 106.91 points, off 0.9%, at 11346.51, off 19.9% from its record close last October.

The Wall Street Journal says today that nearly four years after Merck & Co. yanked the painkiller Vioxx off the market, beleaguered pharmaceutical-industry executives say they are facing a tough new regulatory climate that is altering the landscape of drug development.

Over the past 16 months, Schering-Plough Corp. Chief Executive Fred Hassan and his top scientists have pulled the plug on two drug-development projects -- one for obesity and the other for cholesterol -- that had the potential to produce big sellers. And they're considering scrapping a third.

The reason: Mr. Hassan believes an intensifying focus on safety and a diminished tolerance for side effects at the Food and Drug Administration have dramatically lowered the odds that the drugs would make it to market -- at least not without a lot of extra time and money.

"What will it take to get new drugs approved?"Mr. Hassan asks. "The point is, we don't know."

The Journal says that just last week, Eli Lilly & Co. and Japan's Daiichi Sankyo Co. said the FDA wants an additional three months to decide whether to approve their highly anticipated new heart drug called prasugrel. Days earlier, Merck said the FDA wanted to wait for the results of a huge clinical trial before ruling on its cholesterol drug Cordaptive, which could delay a decision on the medicine until 2013. On Tuesday, an FDA panel is set to consider whether to recommend that the agency adopt tougher standards for diabetes drugs, which could lengthen the development process for many other types of medicines.

Last year, the FDA approved just 19 new medicines, the fewest in 24 years, and announced about 75 new or revised "black-box" warnings about potential side effects -- the agency's strongest -- twice the number in 2004.

The Wall Street Journal also says that bad weather has cost U.S. property insurers more than $5 billion so far in second-quarter catastrophe-related claims -- equal to about three-quarters of all catastrophe claims during 2007 -- and could push the industry to an underwriting loss.

The claims are occurring even as insurers continue to reduce prices, which gives them fewer resources for paying the claims.

"It has been busy,"said Allstate Corp. spokesman Rich Halberg.

According to the property-claims services division of the Insurance Services Office, an insurance-service provider, there have been 15 weather-related catastrophes since April 1, resulting in more than one million claims for a total of around $5.5 billion. For the year, there have been total claims of $8.9 billion for 24 catastrophe events. Claims for all of 2007 amounted to $6.7 billion.

Crude oil for August delivery finished at an all-time closing high $140.21, up 57 cents. It was the first settlement above the $140 mark for crude and the price is up 46% in 2008.

The MSCI Asia Pacific Index added 0.1% by late afternoon trading but most stocks in the region fell Monday.

The Nikkei 225 fell 0.46% and China;s CSI 300 dropped 0.86%.

Babcock & Brown Ltd., which controls the fund that owns Irish telco Eircom,  surged 18% in Sydney to A$7.50, after it won a reprieve from a review of A$2.8 billion ($2.7 billion) of debt. Bank of Scotland Plc and a syndicate of 25 banks waived their right to review the debt after Babcock & Brown agreed to higher repayments.

Asia-Pacific- benchmarks

In Europe Monday, the Dow Jones 600 has risen 0.25% and most markets have risen.

In Dublin, the ISEQ Index has fallen 2.34% with the big financials down sharply following media reports of large potential bad debts at Irish banks.

Anglo Irish is down over 4% and Bank of Ireland has fallen over 5%. Elan has also fallen over 4% following a week of gains.

Davy economist Rossa White, said in a Market Comment today that this is a crucial week for Irish data:

Today's first-quarter national accounts will reveal whether the Irish economy slipped into technical recession or not early in the year. We think it may have avoided that fate, saved by net trade. Credit figures are also due out today for May. We will focus on the money supply, which contracted in April. Later in the week, half-year tax figures are due on Wednesday July 2nd and unemployment claimants for June on Friday July 4th.

Ahead of today's numbers, here is what we know for Q1. Retail sales fell 1.6% quarter-on-quarter. We don't think spending on services, which accounts for 50% of spending (data are not available until today), dropped by as much. Investment slipped, driven by weak machinery and equipment orders as well as housing. But goods imports declined quarter-on-quarter, while exports rose. Net goods exports at least provided a boost, so much depends on the services export figures.

Tax revenue is probably the next most important release in a week when the unemployment claimant figures and credit numbers also have significance. There is much talk of a "corrective" budget in advance of the annual renewal in December. How corrective this will be hinges on the pace of deterioration in revenue. At this point, however, we think that overall revenue will be at least €1.3bn behind target at halfway and will be heading for a minimum miss of €3bn for the full year.