UPDATE 2-FTSE 100 hits three-week high on jobs package, Brexit trade talks

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* British finance minister announces new jobs support plan
* Brexit negotiators say they are inching towards a deal
* UK GDP grows slower-than-expected in August
* FTSE 100 gains 0.7%, FTSE 250 up 0.7%

(Updates with closing prices)
By Shashank Nayar
Oct 9 (Reuters) - London's FTSE 100 closed at a three-week
high on Friday, as a new jobs support plan and advancements in
Brexit talks eclipsed worries about a fresh surge in COVID-19
cases.
British finance minister Rishi Sunak announced his latest
programme to stave off a surge in unemployment, offering extra
help for businesses and workers who are forced to stop work
during local coronavirus lockdowns. Meanwhile, the two chief Brexit negotiators said they are
inching towards a deal. But they have underscored that important
gaps remain on fishing, level playing field issues and
governance and both sides have no-deal plans. The FTSE 100 index .FTSE climbed for the second
consecutive week and ended higher by 0.7%, with mining
.FTNMX1770 and oil stocks .FTNMX0530 leading gains. The
mid-cap index .FTMC added 0.7% and closed near a two-month
high.
Capping gains, however, was a slower-than-expected growth in
Britain's economy in August from July and a surge in COVID-19
cases in England. "Traders are beginning to enter the bad-news-is-good-news
mode, as they feel there is more room left for the UK government
to undertake fresh stimulus steps as headline data continue to
disappoint," said Roland Kaloyan, a strategist at SocGen.
Higher oil prices, hopes of fresh U.S. stimulus and a more
positive tone to Brexit talks have supported the export-heavy
blue-chip index over the past two weeks, offsetting worries
about the economic damage wreaked by the coronavirus pandemic.
Real estate firm British Land BLND.L rose 3.1% after
saying it would resume paying dividends in November and that it
was in active talks with tenants on rent payments. TP ICAP TCAPI.L , the world's biggest inter-dealer broker,
dropped 2.1% after announcing plans to raise about $425 million
through a rights issue to buy Liquidnet Holdings for between
$575 million and $700 million.