* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
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By Elizabeth Howcroft
LONDON, Aug 25 (Reuters) - European shares opened higher on Tuesday, with market sentiment propped up by the United States and China saying they are still committed to their Phase One trade deal, and some increased optimism around COVID-19 vaccine development.
After the STOXX 600 saw its biggest daily gain in almost two weeks on Monday, the bullish mood continued throughout the New York and Asian sessions. U.S. and Chinese officials had a phone call in which they reaffirmed their commitment to the Phase One trade deal agreed in January, in a positive sign after months of disputes over the COVID-19 pandemic, China's national security law and Chinese technology firms. news lifted Asian currencies and stocks, with the Chinese yuan firming slightly overnight. sentiment was also buoyed by a Financial Times report that the U.S. government was considering fast-tracking an experimental vaccine, developed by the University of Oxford and AstraZeneca, to make it ready before the November elections. spokeswoman for AstraZeneca denied the company had discussed an emergency use authorization for its potential vaccine with the U.S. government.
The director of the Oxford Vaccine Group said on Tuesday that the vaccine in development could be put before regulators this year. share indexes opened higher, with the STOXX 600 up 0.4% .STOXX and London's FTSE 100 up 0.3% .FTSE at 0803 GMT.
The MSCI world equity index .MIWD00000PUS , which tracks shares in 49 countries, was up 0.2%. MSCI's main European Index .MSER was up 0.7%.
VACCINE TREATMENT
"It has been suggested that yesterday's rally was as a result of optimism over a new vaccine treatment being fast tracked by October, however the reality is that anyone with an ounce of common sense will know that this outcome is highly unlikely to happen," wrote Michael Hewson, chief market analyst at CMC Markets UK.
"Yesterday's rebound was probably driven by nothing more than a lack of bad news, fear of missing out, and expectations of continued central bank monetary stimulus," he said.
Hewson added that the rebound in U.S. stocks could be called "unbalanced" as it is being driven by a relatively small group of big technology companies.
The dollar index fell gradually overnight, down 0.2% at 93.061 by 0803 GMT =USD , while the euro was up 0.4% at $1.18325 EUR=EBS .
Euro zone bond yields rose for the second day in a row, with the benchmark ten-year German Bund yield at -0.468% DE10YT=RR .
Germany's final second quarter GDP was revised slightly upwards to a 9.7% contraction in April, May and June, up from 10.1%. record decline is much stronger than in the financial crisis more than a decade ago, and is the sharpest fall since Germany began to record quarterly GDP calculations in 1970. prices were mixed, with Brent crude oil futures LCOc1 up 0.3% at $45.25 a barrel by 0806 GMT, while U.S. West Texas Intermediate crude CLc1 was down 0.2%, at $42.55 a barrel. participants are looking ahead to the U.S. Federal Reserve Chair Jerome Powell's address at the Jackson Hole symposium - his first public appearance since the central bank's policy meeting in late July. have been eagerly awaiting details on possible changes to how the Fed targets inflation that, in the current environment, could mean the Fed sticks with aggressive stimulus measures longer than under its previous rubric.
Markets seemed indifferent to news of the first documented instance of coronavirus re-infection in a human. A Hong Kong man who recovered from COVID-19 was infected again four-and-a-half months later, researchers at the University of Hong Kong said on Monday. France said it will require travellers entering the country from the UK to self-certify that they are not suffering coronavirus symptoms or have been in contact with a confirmed case within 14 days preceding travel. Emerging markets
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