India, Nov. 11 -- The rally that carried the Sensex to an eight-month high on Wednesday has an unusual feature. The domestic institutions that absorbed record foreign selling over the past year have now turned net sellers.

Domestic institutional investors (DIIs), including mutual funds, insurers, banks and pension funds, have been net sellers in all six regular trading sessions this month through November 9. Their cumulative net sales during this period stood at Rs 31,369 crore, according to provisional exchange data. This included Rs 10,445 crore on November 5, one of the largest single-day DII sales on record.

For the week ended November 6, DIIs recorded net sales of Rs 24,197 crore, ending an 11-week buying streak.

Foreign investors...