BEIJING, April 8 -- Chinese stocks advanced to fresh seven-year highs on Wednesday, and combined daily turnover on the Shanghai and Shenzhen bourses set a new record at 1.55 trillion yuan (about 251 billion U.S. dollars).

The Shanghai Composite Index rose 0.84 percent to finish at 3,994.81 points, while the Shenzhen Component Index gained 0.53 percent to close at 13,841.72 points.

Boosted by ample liquidity and confidence in the economy, the Shanghai Composite Index climbed above 4,000 points, a key benchmark, for the first time since early 2008.

The Shanghai Stock Exchange's seven-year high was reached in spite of an upcoming wave of new share offerings which will reduce liquidity.

China's security regulator last week approved 30 initial public offerings (IPOs), which could lock up as much as 3.7 trillion yuan (596 billion U.S. dollars) in subscription funds over the next two weeks.

Analysts attributed the booming market to liquidity. Combined daily turnovers on the Shanghai and Shenzhen bourses has remained above one trillion yuan for the past two weeks.

To bolster the lukewarm real economy, the central bank has cut benchmark interest rates twice and banks' reserve requirement ratios (RRR) once since November.

The bullish market also stems from confidence in the Chinese economy as reform of state-owned enterprises and the financial sector speeds up.

Other growth-promoting development programs including the Belt and Road Asian infrastructure initiatives and a scheme aiming to integrate Beijing and neighboring regions have also boosted morale in the market.

Heavyweights led the surge, as PetroChina, the country's largest oil and gas producer, jumped 1.96 percent to end at 12.51 yuan per share, and major insurer China Life jumped 4.3 percent to 40.75 yuan.

The railway infrastructure sector expanded by 4.4 percent. High speed rail manufacturers China North Railway and China South Railway rose by the daily limit of 10 percent, as their merger progresses.

The financial sector jumped 3.78 percent, led by Western Securities, which climbed by the daily limit of 10 percent.

However, the ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, plunged by 2.68 percent to end at 2,488.16 points.

The ChiNext Index has surged by 69 percent compared from the beginning of the year.