* CSI300 +1.7 pct; SSEC +1.8 pct; Hong Kong market closed
* An acceleration in IPOs won’t stop the bull run - Xinhua
* Transport, telecom, machinery stocks up on overseas investment
By Samuel Shen and Pete Sweeney
SHANGHAI, April 7 (Reuters) - Chinese stocks hit fresh seven-year highs on Tuesday morning ahead of the quarterly earnings season, after the official Xinhua news agency said an acceleration in initial public offerings would not stop the market’s bull run.
Last week, China’s securities regulator approved 30 IPOs for April, compared with 24 in each of the previous two months, raising concerns that stepped-up share sales could hurt the market.
But Xinhua said in an article that the current pace of IPOs has negligible impact on the stock market, as regulators hope to channel some of the heavy money inflows into the real economy.
“The market is at a stage when investors are super-excited,” said Shen Zhengyang, Shanghai-based analyst at Northeast Securities.
“Money keeps gushing so it’s impossible to predict when the uptrend will end.”
China’s mutual funds industry exceeded 5 trillion yuan ($807.5 billion) for the first time last month, as asset managers rush to sell products to meet hot investor demand.
For example, Bosera Asset Management Co Ltd said it planned to launch 10 funds in the second quarter alone, mostly with trendy investment themes, such as “Internet”, “Silk Road” and “Big Data”.
The CSI300 index rose 1.7 percent, to 4,239.17 points at the end of the morning session, while the Shanghai Composite Index gained 1.8 percent, to 3,933.49 points. The indexes are at their highest levels since March, 2008.
ChiNext, the Nasdaq-style board for high-growth companies, climbed to fresh record highs, defying concerns over the board’s lofty valuations.
Hong Kong’s markets were closed on Tuesday for a holiday and will resume trading on Wednesday.
Investors drew some confidence in the stellar performance of Beijing Water Business Doctor Co Ltd, the first mainland-listed company to report quarterly earnings. During the January-March period, the ChiNext-listed firm reported a 376 percent jump in net profit.
Robust quarterly profit may add to investor confidence. Some 641 China-listed companies have issued guidance on first-quarter earnings and more than half have predicted they will post profits, according to Xinhua.
Transportation, telecom, and machinery stocks rose sharply, as investors bet they would benefit the most from China’s ambitious overseas investment plan.
Chinese Premier Li Keqiang said Chinese manufacturers should shift the focus to quality from quantity in equipment exports and expand joint production overseas.
Leading the surge in transport stocks were train manufacturers China CNR Corp Ltd and CSR Corp , which both hit their 10 percent daily limit after receiving regulatory approval for their merger.
$1 = 6.1922 Chinese yuan renminbi Editing by Jacqueline Wong