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London stocks track Asia higher on U.S. stimulus hopes

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* FTSE 100 up 0.9%, FTSE 250 gains 0.4%

Oct 1 (Reuters) - London stocks tracked Asian markets higher on Thursday as hopes for fresh U.S. stimulus measures bolstered global investor sentiment, although risks of a new round of lockdowns due to rising COVID-19 cases in the UK kept gains in check.

Markets globally held steady after the Trump administration on Wednesday proposed stimulus measures worth $1.5 trillion, including a $20 billion aid for the airline industry.

The blue-chip FTSE 100 index climbed 0.9% with insurance and banking stocks leading gains, while the mid-cap index rose 0.4%.

Aero-engine maker Rolls-Royce dropped 4.7% after it said it planned to raise 2 billion pounds ($2.6 billion) from shareholders, 1 billion pounds from the bond market and secure further loans to rebuild its balance sheet after the pandemic.

Retailer Halfords jumped 10.3% after it raised its first-half profit outlook as it continued to benefit from a cycling boom during the pandemic. (Reporting by Shashank Nayar in Bengaluru; Editing by Subhranshu Sahu)

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