The FTSE 100 was lower at midday on Wednesday, led by commodities stocks and retailers as concerns surrounding Europe's debt crisis muddied the growth outlook and kept the index in its recent tight range.

The blue-chip index <.FTSE> was down 47.41 points, or 0.9 percent, at 5,442.74 by 11:29 a.m. in weak volumes -- the FTSE had traded 17 percent of average 90-day volume. The FTSE 100 has remained in a tight range around 5,400-5,600 this month.

Traders said the catalyst for the latest market retracement was the decision overnight by the U.S. Federal Reserve not to fuel the market with more cheap money, and saying Europe's debt crisis remained a threat to economic recovery.

That prompted profit taking in miners <.FTNMX8350> and integrated oils <.FTNM0530>, Tuesday's top gainers, with heavyweight oil giant BP and global miner RIO Tinto up to 2.7 percent lower.

Retailers were under pressure too as leading investment banks forecast more gloom for the sector in the face of Europe's debt crisis, austerity measures and flagging consumer sentiment.

Tesco fell 0.3 percent as ING cut its rating to sell from buy, while Marks & Spencer shed 0.8 percent as the broker downgraded its recommendation to sell from hold.

Citigroup said a combination of severe economic conditions and unsustainable industry trends meant EPS contraction would not be an unreasonable scenario for food retailers in 2012/13.

JPMorgan said investors should expect more retail pain over the Christmas period.

Wm Morrison Supermarkets rose 0.2 percent as ING lifted its rating to buy from hold, citing its defensive qualities.

Next , which Investec recently said was a safe port in these stormy times, rose 0.8 percent.

FTSE 250 <.FTMC> fashion retailer SuperGroup added 8 percent after first-half results which prompted Seymour Pierce to repeat its buy rating on the stock.

UK EMPLOYMENT PAIN

Retailers have said the run-up to the Christmas has been a struggle with sentiment dampened by weak updates from Tesco and Kesa in recent weeks.

Unemployment continues to heap pain on domestic retailers, as the number of Britons out of work rose to its highest level in more than 17 years in the three months to October, as weak economic growth, government austerity measures and Europe's debt crisis weighed on employers.

Logica fell 17 percent after the Anglo-Dutch IT group slashed more than 1,300 jobs in response to worsening conditions in its European markets, and cut its growth forecast again.

Thomas Cook , which secured a rescue package from lenders last month, shed 6.8 percent after travel firm reported full-year operating profit at the bottom end of forecasts and said it would close 200 underperforming shops, as it looks to cut debt and restore investor confidence.

Blue-chip banks <.FTNMX8350> were lower with so much of their financial performance, given their debt exposure to Europe, linked to events in the euro zone.

Goldman Sachs said while the European Central Bank's latest liquidity measures -- reserve ratio cut, three-year refinancing and expansion of collateral -- substantially enhanced the sector's resilience and guarantee bank funding stability in 2012/13, it retains a neutral sector view, given euro zone developments.

The broker said HSBC and Lloyds Banking Group were among its group of 'investable' banks.

Ashmore Group shed 3.8 percent as Peel Hunt highlighted another tough month for the asset management firm's funds.

Ex-dividend factors knocked 0.5 point off the FTSE 100 index on Wednesday, with Fresnillo both trading without their payout attractions.

Defensive stocks dominated the upside, with National Grid , Imperial Tobacco and Vodafone all slightly higher as investors sheltered in safer havens.

U.S. stock index futures pointed to a mixed open on Wall Street on Wednesday, ahead of U.S. November import/export prices data due at 1330 GMT. (Editing by Dan Lalor)