* Oils, miners weak as Fed meeting decision awaited
* Inmarsat knocked by double broker downgrades
By Jon Hopkins
LONDON, Sept 21 (Reuters) - Weakness in commodity issues kept Britain's leading shares lower at midday on Wednesday, as investors focused on the outcome of a U.S. Federal Reserve meeting, with the likelihood of further economic stimulus seen as already discounted.
The FTSE 100 was down 23.41 points, or 0.4 percent at 5,340.30 at 1046 GMT, midway between session highs and lows and consolidating after a 2.0 percent advance on Tuesday.
Integrated oils were the biggest drag on blue chip sentiment, led by BP down 1.1 percent, as the crude CLc1 price retreated ahead of the Fed decision.
Investors expected the U.S. central bank, which concludes its two-day policy meeting later, would act to push down already low long-term interest rates by tilting its portfolio towards longer maturities in a move known as 'Operation Twist', rather than announce more quantitative easing.
Traders said Operation Twist has largely been priced in, meaning the upside was likely to be limited should it be announced.
"It is probably going to be a bit of a damp squib in the end, because it is all very well selling short-dated (assets) to buy back long-dated to bring in their interest rates, But it is not going to have a huge impact, and not necessarily going to get the 14 million unemployed back in work," said Angus Campbell, head of sales at Capital Spreads.
Miners stayed under pressure, with Antofagasta and Xstrata among the worst off, down 3 percent and 1.5 percent respectively, while commodities trader Glencore was the top blue chip faller, down 3.4 percent.
Precious metal miners bucked the dull trend, with Fresnillo ahead 2.2 percent as the gold price rose on support from investors searching for safe havens.
Technical factors also provided support for Fresnillo, according to Andrew Gibson, Head of Research at Galvan.
"Shares in Fresnillo have bounced off the current level of the 50-day moving average at 1,839 pence and while above the intraday low of today at 1,910 pence, the upside indicates the bottom of the September gap down towards 2,100 pence as a near-term target," Gibson said, with Galvan repeating a "buy" stance on Fresnillo.
Banks were also higher, extending Tuesday's advance as bargain hunters held sway, with part state-owned Lloyds Banking Group the top blue chip riser, up 5.2 percent, while Royal Bank of Scotland added 2.1 percent.
IMPERIAL IN DEMAND
An in-line trading update supported gains in Imperial Tobacco , ahead 1.2 percent, with Investec Securities repeating its "buy" rating on the cigarette manufacturer.
"We view Imperial's Q4 update as positive and reassuring relative to expectations. Revenue and volume performance has improved in Q4 against toughening comps," Investec said.
SABMiller shed 0.4 percent as the brewer agreed to buy Foster's Group for an increased price of A$5.10 per share valuing its Australian peer at A$9.9 billion ($10.2 billion). [IDLnL5E7KL1WU]
Inmarsat weighed on the downside, shedding 3.1 percent, with traders citing the impact of two broker downgrades for the British satellites operator, partly on valuation grounds, and partly due to concerns over progress at its U.S. partner LightSquared.
Ex-dividend factors clipped 1.5 points off the FTSE 100 index on Wednesday, with Aggreko , Aviva , International Power and Petrofac all trading without their dividend attractions. (Additional reporting by Trisha Wright; Editing by Dan Lalor)
