Amsterdam - The main index of the Dutch stock exchange AEX rose sharply on Monday following the US government's bail-out of American largest mortgage banks Fannie Mae and Freddie Mac on Sunday.

By 10:23 am (8:23 AM GMT) the AEX had risen by 3.89 per cent, with the financial funds gaining most.

Belgian-Dutch bank and insurance company Fortis rose 8.65 per cent and stood at 9.907 euros.

Insurer Aegon stood at 8.525 euros, up by 7.68 per cent, followed by ING Bank which rose by 7.64 per cent. Employment agency Randstad came in fourth, with shares rising 7.02 per cent.

Dutch-British food company Unilever was the only one to drop, down by 0.10 per cent.

However, Fortis economist Joost van Leenders (Fortis) was cautious about Monday's rise of the AEX index.

It remained "highly uncertain" whether the decision by the US government to take over the two mortgage banks Fannie Mae and Freddie Mac would have a long-term effect on the credit market, he said on Dutch television.

But analyst Rob Koenders of Harmony Vermogensbeheer said the intervention by the US government might mark the turning point in credit crisis that began just over a year ago.

"The key issue is to stabilize the real estate market and ensure a drop in the interest on mortgages," Koenders said. (dpa)