The Ho Chi Minh Stock Exchange's VN Index extended gains by midday after positive earnings reports, while institutional investors are yet to return on concerns about bad debt and violations in the banking industry.
At 0430 GMT, the index was up 0.45 percent at 396.45.
"Shares extended gains, led by penny stocks after more firms reported good earnings," said Doan Tran Phuong Phi, head broker at Ho Chi Minh City Securities.
Penny stocks providing support included Tan Tao Investment and Industry Corp , Kinh Bac City Development Share Holding Corp and several mining firms such as Binh Thuan Mineral Industry Co .
Volumes edged up while buyers remained cautious because the country's macro problems have not been solved, in particular the violations in the banking industry, Phi said.
A mild correction is expected in one to two sessions when the VN Index approaches a major resistance level at 405 while the Hanoi exchange's index would come near 58 points, he said.
"Low trading volume shows that institutional investors have not returned to buy as they do not believe the bad debt will be solved soon," said Vu Thanh, an analyst at ACB Securities.
Technical breakout signals have yet to emerge and there are no major cash flows, said Nguyen Hoang Long, brokerage director at An Binh Securities.
1145 (0445 GMT)
(Reporting by Vu Duy; Editing by Ho Binh Minh)
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Keywords: MARKETS VIETNAM STOCKSNEWS/