(Updates after markets close)

* FTSE 100 down 0.7%, FTSE 250 down 1.3%

* Both indexes mark biggest one-day fall so far this month

* Government bond yields rise across Europe on inflation

worries

July 23 (Reuters) - Britain's FTSE 100 eased on Thursday as

global risk sentiment took a hit with government bond yields up

and crude oil prices passing the crucial $100 a barrel mark as

the Middle East conflict showed no signs of slowing down.

The blue-chip FTSE 100 index fell 0.7% to 10,639.2

points, reversing most of the previous session's 1% rise, while

the midcap FTSE 250 was down 1.3%. Both indexes marked

their biggest one-day fall so far this month.

* Precious metal miners dropped 5.1% as gold

prices fell around 2% on a stronger dollar and rising inflation

concerns due to the oil price spike.

* Utilities lost 2.5%, the personal goods sector

was down 2.2% and beverages fell

2.1%.

* Travel and leisure shares retreated 1.9%

with shares of airlines including Wizz leading declines

as higher oil prices weighed.

* Mitchells & Butlers ( MBPFF ) fell 5.1% after the pub group

reported flat third-quarter like-for-like sales, citing the

adverse impact on its food business from the ongoing heatwave.

* Heavyweight banks dropped 1.3% and

aerospace and defence eased 0.8%.

* Government bond yields in the United States and across

Europe rose as the threat of higher inflation increased the risk

of future interest rate hikes.

* Brent crude's more than 6% rise helped Britain's

energy giants advance 2.1%.

* U.S. President Donald Trump promised "major military

punishment" for Iran and its Houthi allies, after the Yemeni

fighters struck two Saudi oil tankers in the Red Sea, extending

the Middle East war to a second major shipping chokepoint.

* Britain's new prime minister, Andy Burnham, said he would

lower business rates for pubs, clubs and live music venues by

20% from April, his third announcement in three days of measures

to help households and businesses.

* Takeover target easyJet rose 2.7% despite the

airline's third-quarter profit slumping 70% as the Iran war led

to volatile fuel prices and made travellers wary, though

earnings beat analysts' estimates and the carrier indicated

somewhat clearer skies heading into peak summer.