The 30-share BSE benchmark was trading 648.25 points lower at 56,412.62.
Meanwhile, retail inflation soared to a 17-month high of 6.95 per cent in March, and remained above the Reserve Bank's upper tolerance level.
Among Sensex constituents, Power Grid, Asian Paints, UltraTech Cement, Nestle, Hindustan Unilever Limited and HCL Technologies were among the major laggards.
The 30-scrip BSE Sensex was up by 503.79 points or 0.87 per cent at 58312.37 at 9.30 am.
The 30-scrip BSE Sensex was up by 304.84 points or 0.53 per cent at 57581.78 at 9.25 am.