UPDATE 2-Britain's mid-cap shares fall on political uncertainty

* FTSE 100 ends flat, FTSE 250 down 0.7%
* Lingering Brexit worries weigh on domestic stocks
* Sainsbury's outperforms on robust earnings update
* UK tobacco giants rise as U.S. rivals end merger talks

(Adds news items, updates share moves)
By Muvija M and Indranil Sarkar
Sept 25 (Reuters) - Britain's mid-cap share index fell by
its most in six weeks on Wednesday, weighed down by uncertainty
over Brexit as parliament reconvened after a court ruling
against the prime minister.
The FTSE 250 .FTMC , made up of firms that tend to be more
reliant on the UK market than the exporter-heavy FTSE 100
.FTSE , shed 0.7%, its biggest one-day drop since Aug. 14.
The FTSE 100, meanwhile, closed flat after recovering from
an initial slide with the help of a steep drop in sterling.
Worries over how, when or if the UK will leave the European
Union have dragged down sterling for most of the year, helping
the FTSE 100 climb month on month June and July.
Lawmakers met after the Supreme Court ruled on Tuesday that
Prime Minister Boris Johnson had acted illegally in suspending
parliament, ahead of the Oct. 31 deadline for Britain to leave
the European Union, unless London requests an extension.
"It is not immediately clear what (parliament) will be able
to achieve. It is more likely that this time will be wasted with
political chicanery instead of striving to break the impasse
(over Brexit)," CMC Markets analyst Michael Hewson said.
Among the blue-chip climbers, tobacco firms British American
Tobacco BATS.L and Imperial Brands IMB.L rose 3.3% and 2.3%,
respectively, after their U.S. rival Philip Morris ended merger
talks with Altria MO.N . Sainsbury's SBRY.L added 2% after the supermarket chain
laid out a new plan to cut costs, speed up debt reduction and
overhaul its store estate and financial services division as it
reported better trading in the recent quarter. Elsewhere, internet-based fashion retailer Boohoo BOOH.L
managed a modest gain after its shares fell as much as 4% as
result of profit taking. Babcock BAB.L climbed 6.8% to a near one-year high after
the midcap-listed engineering services group said first-half
trading was in line with expectations and stuck to its annual
targets.
Aston Martin AML.L fell 4.2% after a bond issue that will
see the firm's borrowing costs jump.