ASX Set to Decline as Wall Street Sell-Off and Middle East Tensions Weigh

The Australian stock market is expected to decline on Thursday, with futures indicating a drop of 61 points or 0.7% following heavy losses on Wall Street and a surge in global oil prices.

Inflation data released on Wednesday showed annual headline inflation easing to 3.8%, well below the Reserve Bank of Australia's forecast of 4.8%. This reduced expectations of an interest rate hike at the RBA's August meeting, with traders cutting the probability to around 50% from more than 90% previously.

The S&P/ASX 200 gained 90.8 points or 1% on Wednesday after the inflation data was released, with consumer and technology stocks leading the rally. However, investors will be cautious on Thursday as they assess the impact of the global market downturn and Middle East tensions.