Mumbai: The SENSEX opened marginally lower and later dipped below 3,500-level in line with the declining trend in lacklustre activity at early stages on the Bombay Stock Exchange (BSE) on April 3 following fresh sell-off triggered by reports of continued communal violence in Gujarat.

The BSE sensitive index opened slightly lower at 3,500.76 as against close of 3,505.79 on April 2 and later dropped to a low of 3,483.97 before being quoted at 3,486.54 at 10:30 hours (IST).

Reports that communal violence has spread to new areas in Gujarat had an adverse impact on the sentiment as speculators and retail investors, which have turned cautious in the light of slow down by Foreign Institutional Investors (FIIs) as well as introduction of T+3 settlement system from April 1, pressed increased sales, market sources said.

Brokers and institutional investors seemed to be worried over prevailing political situation and also expressed apprehensions about future earnings growth for IT companies.

A sharp fall by about 58 points in the NASDAQ composite index on April 2 also triggered selling pressure.

PTI