European shares rise as Yellen keeps options open

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* STOXX Europe 600 index up 0.5 pct

* Miners top sectoral gainers

* Gemalto (LSE: 0OGA.L - news) surges after results

* Vivendi (LSE: 0IIF.L - news) down as results disappoint

By Danilo Masoni

MILAN, Aug 26 (Reuters) - European shares rose on Friday after Federal Reserve chair Janet Yellen gave no firm indication about when the Federal Reserve might raise interest rates, encouraging markets after hawkish comments from Fed policymakers last week.

Yellen however said that the case for a rate hike had strengthened thanks to improvements in the labour market and expectations for solid economic growth, reiterating that future increases should be "gradual".

The pan-European STOXX 600 rose 0.5 percent, with almost all sectoral indexes showing gains. The index was up 0.1 percent shortly before Yellen's comments were published.

"Markets had been half-expecting some hawkish noises around a possible September rate hike but it looks like the Fed chair is playing it cautious," ETX Capital analyst Neil Wilson said.

"The case for raising rates has been strengthening for years, so this is not telling us much," he said.

The STOXX Europe 600 Basic Resources (Frankfurt: W8Z.F - news) index rose 2.4 percent, making it the biggest sectoral gainer, helped by a rally in metal prices after two days of losses.

Shares (Berlin: DI6.BE - news) in Glencore (Frankfurt: 8GC.F - news) , Rio Tinto (LSE: RIO.L - news) and Antofagasta (Other OTC: ANFGF - news) rose between 2.7 percent and 3.3 percent.

Digital security firm Gemalto was among the biggest gainers on the STOXX, surging 6.5 percent after its first-half results came in slightly better than expected.

Amec Foster soared more than 6 percent on a Morgan Stanley upgrade to "overweight" from "equalweight".

Vivendi fell 1.7 percent, after core profits at the French media group fell more than expected in the second quarter, dragged down by losses at the French channels of its pay-TV Canal Plus.

Jefferies, which rates Vivendi a "hold", cut its price target on the stock, saying it saw uncertain prospects for a turnaround given the increasingly competitive domestic market.

Fingerprint Cards (LSE: 0GTP.L - news) fell 2.8 percent after Nordea initiated its coverage of the stock with a "sell" rating, saying it saw the company's earnings hitting a peak this or next year. (Additional reporting by Atul Prakash in London; Editing by Louise Ireland)