Amsterdam recovers after volatile day

Shares in Amsterdam rose again on Tuesday afternoon as the US federal reserve slashed benchmark interest rates by three-quarters of a percentage point to lend support to the economy. The AEX blue-chip index closed up 2.56% at 433.27 points.

The AEX had been volatile all day after falling by as much as 6% in early trading to just above 400 points. Tuesday’s decline followed Monday’s panic selling which saw the AEX slide by over 6%, the biggest drop on the index since the 2001 terrorist attacks in the US.
With all eyes on stock market developments, prime minister Jan Peter Balkenende criticised Liberal (VVD) party leader Mark Rutte for accusing the cabinet of ‘sticking its head in the sand’ and calling for tax cuts to give the economy a lift.
Such comments could contribute to ‘negative sentiment’ about the economy, news agency ANP reported Balkenende as saying.
Balkenende said there was no comparison between conditions now and during the last serious crisis in 2002. Then, the Dutch unemployment rate was high and the government’s finances were in poor shape, he said.
The prime minister also made veiled criticism of economic affairs minister Maria van der Hoeven who had urged investors to hold on to their shares and wait it out during a BNR radio interview on Monday evening. Decisions as whether to buy or sell were up to investors, not ministers, Balkenende told BNR.
Earlier VVD MPs said the minister had overstepped the mark.

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