The situation is different for each company. For a Good company, the share sale will increase the liquidity in the market and it can actually enthuse more BUYERS to BUY. This means, market sentiment will improve. In some companies, the floating stock is very limited because of large promoter holding. This itself depresses sentiment. Promoter holding and public holding must both be healthy - to enthuse the market.
Market sentiment gets depressed only when Indian financial institutions go on a selling spree, even when FIIs are on a BUYING spree. Such divergent view of the market by Indian institutions is the only reason for market sentiment to come down unnecessarily.