By Tharuniyaa Lakshmi and Utkarsh Hathi
Aug 20 (Reuters) - European shares inched lower on Thursday, as elevated oil prices kept inflation worries alive, while a recovery in global bonds after a U.S. Treasury intervention helped limit losses.
The pan-European STOXX 600 closed 0.12% lower at 650.35 points, extending its losing streak to a seventh straight session, its longest since September 2023.
An impasse in U.S.-Iran talks to end the six-month Middle East conflict has dampened hopes for energy supplies
to resume through the Strait of Hormuz, pushing oil prices above $90 a barrel in recent days and rekindling inflation fears among global investors.
"Price pressures could move higher in the coming readings as the July retreat in energy prices proved temporary. With no easy resolution in the Middle East, inflation risks remain tilted to the upside," said Ipek Ozkardeskaya, senior analyst at Swissquote.
Shares of energy companies rose 0.9% as Brent crude futures climbed 2.2%, but the higher oil prices sent travel and leisure stocks down 0.7%.
There was relief in markets, however, that euro zone bond yields steadied on Thursday from multi-year highs following the U.S. Treasury's move on Wednesday to boost liquidity support for long-term debt.
JD SPORTS PLUNGES
France's benchmark CAC 40 underperformed regional peers, down 0.6% as luxury stocks slipped. Gucci parent Kering and Louis Vuitton parent LVMH slid 3.6% and 2.8% respectively.
On the macro front, German producer prices rose at their fastest pace in over three years in July, data showed, driven by higher costs for intermediate goods and energy.
Sweden's benchmark share index rose 0.3% after the Riksbank left its key interest rate unchanged at 1.75% as expected and signalled it stood ready to tighten policy if price pressures accelerate.
Among individual movers, JD Sports plunged 14.3% to the bottom of the STOXX 600 after the British sportswear retailer cut its profit outlook following a steeper-than-expected drop in second-quarter underlying sales, particularly in North America.
Novonesis jumped 9.7% after the Danish biosolutions maker reported better-than-expected second-quarter results, raised its full-year guidance and announced a share buyback.
(Reporting by Tharuniyaa Lakshmi and Utkarsh Hathi in Bengaluru; Editing by Mrigank Dhaniwala and Susan Fenton)
