Shares in Britain's biggest insurer Aviva have risen sharply after the firm unveiled steady profits despite the recent stock market slump.

Aviva, formerly CGNU, said on Thursday that operating profits for the six months to June came in at �979m ($1.3bn) , little changed from $977m during the same period last year.

Some analysts, worried over the impact on the company's bottom line of plunging share prices, had predicted a lower figure.

City investors welcomed the news, marking Aviva's shares 6% higher in early trade.

Aviva chief executive Richard Harvey described current market conditions as "challenging," but said the company's "long-term dynamics" were unchanged.

Stocks fall-out

Insurers and pension providers, who depend on solid stock market returns in order to make payments to policyholders, have been hit hard by recent share price turbulence.

London's benchmark FTSE 100 share index has lost about a third of its value so far this year because of concerns over corporate wrongdoing in the wake of the Enron and WorldCom scandals in the US.

Aviva's main UK rivals, Prudential and Legal & General, have both reported a decline in profits for the first half of the year.