China's burgeoning mutual investment funds recorded a sharp rise in net profits in the first half year, thanks to a reinvigorated stock market, the Xinhua-run Shanghai Securities News reported on Tuesday.

Interim reports from 241 funds managed by 50 firms show they made record profits of 51.14 billion yuan (6.42 billion U.S. dollars) in the first six months.

All mutual investment funds have now released their interim reports.

The combined turnover of these funds amounted to 105.94 billion yuan (13.29 billion dollars), also an all-time high.

The 104 funds which had released their interim reports by last Friday made a loss of 915 million yuan (115 million dollars) in the same period last year, compared to a net profit of 26.21 billion yuan (3.29 billion dollars) for the first six months of 2006.

China's stock market began to recover in May after two years of gloom, with the Shanghai Composite Index rebounding from an all time low of 998 points to 1,600 points in just one week.

It is believed that the recovery is mainly a result of the smooth reform transforming non-tradable state-owned shares in listed firms into fully tradable shares. Most of the listed firms are restructured state-owned enterprises.

The bullish market means that mutual funds which had invested heavily in the stock market have performed better in the first half year.

Analysis shows that 188 stock-oriented funds reaped a profit of 49.91 billion yuan (6.26 billion dollars), 98 percent of total profits for the 241 funds.

Source: Xinhua