UPDATE 4-Hurricane Jimena batters western Mexico

* Jimena smashes homes, tears away boats at a port

* Hurricane loses punch, set to become a storm

* Los Cabos resorts show little damage, weather calm (Changes dateline, adds detail)

By Henry Romero

SAN CARLOS, Mexico, Sept 2 (Reuters) - Hurricane Jimena smashed flimsy buildings, bent trees and tore fishing boats from their moorings as it collided with Mexico's Baja California peninsula on Wednesday.

Ports at San Carlos, La Paz, Los Cabos and Topolobampo were shut as Jimena pummeled the coast and desert towns inland with winds as high as 100 mph (160 kph) and torrential rains that forecasters said could cause dangerous floods and mudslides.

Two fishing boats were torn away at the tiny port of San Carlos, residents said. One crashed into the dock and broke it, and the other sank. Telephone poles and corrugated iron warehouses in the town were knocked over.

Jimena weakened to a moderate Category 1 hurricane by mid-afternoon, however, with winds down to 85 mph (140 kph), the U.S. National Hurricane Center said. It forecast the hurricane would peter out to tropical storm intensity during the night.

Residents of Ciudad Constitucion, further inland, surveyed damage to their homes after fleeing in the middle of the night. Police said there were no casualties.

Jimena, the second eastern Pacific storm this season to strike Mexico, drenched the upscale resort of Los Cabos on the southern tip of the peninsula overnight but there were no reports of serious injuries or damage.

Beachfront restaurants in Los Cabos swept up debris, emptied out storm sandbags and hotels removed boards from their windows as the weather calmed down. But many tourists had already cut their vacations short and flown home.

"This leaves us with a very bad week," Gonzalo Fanyutti, head of the Los Cabos hotels' association told local radio.

BENT PALM TREES

A hurricane warning remained in effect for the north of the Baja California peninsula, but by mid-afternoon Jimena was moving back offshore. It could hit land again on Thursday but as a much weaker storm.

"It wasn't that bad, you just had to sit in your house for a day," said Bill Gardner, 67, an accountant from Utah on vacation in Los Cabos, home to world-class golf courses, yachting marinas and five-star hotels.

After buffeting Los Cabos and flooding nearby slums, the storm touched land in a much more sparsely populated area.