Share prices on the Amsterdam stock exchange were extremely volatile on Tuesday after falling by as much as 6% in early trading.
After almost dipping under 400 points, the AEX blue-chip index was back over the 420 point mark by 11.30 but then headed back into the red.
‘Investors are waiting nervously for Wall Street’s opening later in the day,’ asset manager Sijmen Plomp told news agency ANP.
Tuesday’s decline follows Monday’s panic selling which saw the AEX slide by over 6% to 422.45 points
It was the biggest drop on the index since the September 11 attacks in the US in 2001 and the fifth day of heavy losses in a row. Financial stocks in particular were badly hit.
The downturn came a day after central bank president Nout Wellink warned that the American credit crisis would have an effect on the Dutch economy and called on finance minister Wouter Bos to start planning to offset any economic downturn.
Tom Muleer, an analyst at Theodoor Gilissen, told the Telegraaf he did not expect a short-term recovery and suggested a possible sharp reduction in US interest rates at the end of the month could further influence the negative sentiment.
Economic affairs minister Maria van der Hoeven urged investors to hold on to their shares and wait it out, saying the Dutch economy was ‘not badly’ placed. ‘Industry expects to invest 4% more this year and unemployment fell again last year,’ she told a BNR radio programme on Monday evening.
Her comments were heavily criticised by Liberal MPs. The minister had overstepped the mark and gone beyond the bounds of her job, MPs said.
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