Hi there !!  I have the same car, and it has been a very reliable car, the
check engine light came on, and the transmission select light were blinking,
and it turned out to be a loose contact on the transmission gear selector,
it went away after parking the car  and moving the gear shift through all
the different positions a few times.  You might want to consider either
purchasing an OBD2 reader or taking it to a chain like "Autozone" to have it
scanned for codes. take a look at this link:
http://www.fcpgroton.com/volvocodereader.htm
or this one.
http://www.ipdusa.com/ProductsCat.aspx?CategoryID=1721&NodeID=5380&RootID=629

Good Luck
Arnold

The important thing to remember is that the "check engine" light is there to
let you know there is an emission related problem that you might not know
about unless it told you. As long as the engine runs okay it is safe to
drive around town, and as long as the fuel economy is fairly normal (20 mpg
or so) it can be driven normally.

The question is "why did the light come on?" The answer requires an OBDII
scanner to read the codes. In the meantime, make sure the gas cap is tight.
Loose gas caps probably account for more than half of all "check engine"
light episodes. If the cap is loose, even a little bit, the light will stay
on for several days of driving after you tighten it.

Mike

Without having a code reader say what is wrong it is impossible to make
even an educated guess.

I have this. Disconnect the battery, and undo the two leads to the lambda
sensors. They are down near the gearbox filler(on RHD anyway).

The get gummed up. Reconnect them and the battery.

Hopefully should be ok if not then something more serious I'm afraid.
John