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There is a sudden change in the strategy of the FPIs starting January 17 and they turned massive sellers in the cash market having sold equity worth Rs 24,147 crore in three days from January 17-19, says V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

There are two main reasons why FPIs turned sellers.

One, the US bond yield started rising with the 10-year yield rising from the recent level of 3.9 per cent to 4.15 per cent triggering capital outflows from emerging markets. It is important to understand that FPIs were big sellers in other emerging markets too like Taiwan, South Korea and Hongkong.

Two, since the valuations in India are high, FPIs used the excuse of less-than-expected results from HDFC Bank to press massive sales. FPIs increased their short positions, too, he said.

But the FPI strategy of pushing the market down is not working since their selling is countered with buying by DIIs and individual investors. FPIs have been buying IT stocks this month after the management commentary following the Q3 results of IT managers indicated optimism of demand revival in the sector, he said.