* Australia shares hit one-week low
* Aussie consumer inflation, employment data due later in the day
* NZ up for third straight day
By Shashwat Awasthi
April 16 (Reuters) - Australian shares dropped more than 2% on Thursday as dour U.S. economic data and dismal earnings from Wall Street heavyweights painted a grim picture of the extent of damage from the coronavirus crisis.
U.S. retail sales plunged to their lowest on record, manufacturing output dropped by the most in more than 74 years, and major Wall Street banks issued bleak forecasts as markets began to get some semblance of a fallout from the pandemic.
S&P/ASX 200 .AXJO erased this week's gains to trade 1.5% lower at 5,387.6 points, as of 0130 GMT, with heavyweight miners .AXMM and financials .AXFJ shedding 2.4% and 2.8%, respectively, as dealers braced for consumer inflation and March employment figures later in the day. Earlier in the session, the benchmark index dropped as much as 2.1%.
The latest batch of data from Australia will come after surveys this week showed steep falls in business and consumer confidence, as lockdown measures to curb the virus put the country at risk of its first recession in three decades. Reuters poll forecasts employment to fall by 40,000 for March. Analysts at ANZ Research expect the unemployment rate to rise to 5.3%, and said greater losses would become evident next month.
An index of energy firms .AXEJ sank 2.3% even though crude prices came off 18-year lows hit overnight. Woodside Petroleum WPL.AX , which reported lower first-quarter sales revenue on Thursday, weakened as much as 3%.
"The market is gradually leaning towards a combination of deeper OPEC+ cuts and a more assured response from the G-20 producers to avoid a further collapse in oil," said Stephen Innes, chief global markets strategist at AxiCorp.
Shares of Crown Resorts CWN.AX skidded 2% after the casino operator said it has stood down about 95% of its employees due to the suspension of services at its Melbourne and Perth resorts. stocks .AXGD , which have supported the Aussie bourse's gains in recent sessions, also slid 1.6% as profit-taking led to weaker bullion prices.
However, with corporate earnings expected to remain soft and a global recession looming, the drop in the prices of the safe-haven metal may be short-lived.
Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index .NZ50 advanced for a third straight session and added 1.3%.
The bourse climbed to its highest level since March 12.