More than likely, based on my experience, your front inner "A" arm bushings are gone. The easiest solution is to buy new arms with the new bushings already installed. You need a good press and some adapter tools to DIY the bushings into your existing arms. Some recommend F.C.P.Grotten??? I bought the press adapters from Volvo and already had a #2 arbor press to do mine.

Your S90/V90 design doesn't use sway bar bushings like the early 960 or 700 series. The 960 & S/V90 front suspension from '95 on is a whole new design. The links connect directly from the bar to the strut and hence need to pivot with the strut. They have miniature style ball joints and will "rattle like hell" when they get loose. (Usually because the boot fails and water caused rust chews up the plastic in the joint .)
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'96 965, 16" wheels, Michelin Pilot Sports, rear 18mm bar + Koni, 204HP cams, 128K. Put 200K on '85 745 TD.