China Team finally got off the mark with their victory over Oracle

The American favourites came to grief after losing their headsail in the second set of round robins on Monday.

The 2003 LV Cup finalists limped on after failing to set a second headsail, hoping for a mistake from their error-prone rivals.

But the bottom-placed Chinese team held their nerve to take victory over BMW Oracle by three minutes 15 seconds.

The US team were joined at the top of the rankings on 23 points by Italians Luna Rossa, who saw off Swedish boat Victory Challenge.

Excellent racing conditions also produced a win for local favourites Desafio Espanol who pipped +39 on the line by just one second.

The Spaniards trailed for most of the race but closed on +39, who suffered problems with their sails, and slipped ahead 200m from the finish to take the two points.

Desafio held on to fourth place with 19 points, one behind Team New Zealand who beat Mascalzone Latino. Victory Challenge are fifth with 16.

It was a day to forget for Mascalzone Latino as they picked up a penalty and lost out in a tight contest with French challenger Areva in their first race of the day.

They pushed the Kiwis all the way in their second race, which had been held over from Sunday.

As they came down the final leg they lost a crewman overboard after their spinnaker pole broke, though he held on to a rope and was hauled back on board. It was their fourth straight defeat.

Shosholoza recovered from Sunday's frustrating defeat to beat United Internet Team Germany by more than a minute.

The South Africans stayed in the hunt for a top-four finish, moving on to 14 points level with Mascalzone Latino in sixth.

Areva completed a double on the day with a win over +39 to go eighth with 13 points.

The top four boats after the second set of round robins progress to the semi-finals. The winners of the LV Cup go on to face Swiss defenders Alinghi for the Americas Cup at the end of June.