* Aussie blue-chips provide safety trade - analyst
* ASX heads higher for fifth month higher, but down on week
* Oil and gas units drag main index (Updates to close)
By Devika Syamnath
May 31 (Reuters) - Australian shares ended stable on Friday, as investors switched to blue-chips and safe-haven gold stocks with broader equity markets rattled by fears that U.S. President Donald Trump's aggressive trade diplomacy could lead to recession. MKTS/GLOB
Trump took markets by surprise on Thursday by threatening to slap a 5% tariff on goods from Mexico, and increase them to as high as 25% unless more was done to stop the flow of illegal immigrants into the United States. S&P/ASX 200 index .AXJO ended the session 4.80 points higher at 6,396.90. The benchmark marked its fifth straight month of gains but lost over 1% this week, giving up some of last week's election surprise and iron ore-driven gains.
"When you have got Asian worries, emerging market worries, money tends to run out of China and emerging markets into Australia... They tend to buy the large caps," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.
Mining behemoth BHP Group Ltd BHP.AX , Commonwealth Bank of Australia CBA.AX and pharma giant CSL Ltd CSL.AX - Australia's first, third and fifth largest stocks by market capitalization - all closed higher.
Large cap industrials also saw buying activity, with toll road operator Transurban Group TCL.AX and Sydney Airport Holdings Pty Ltd SYD.AX gaining 1.8% and 1.2%, respectively.
The sub-index for gold stocks .AXGD jumped over 2.6% to its best close since February, basking in its safe-haven appeal enhanced in times of global uncertainty.
Gold miner Newcrest Mining Ltd NCM.AX ended at its best level since 2012.
In other mining news, rare earths miner Lynas Corporation Ltd LYC.AX finished at an over five-year high on a double-whammy of positive leads.
Malaysian Prime Minister Mahathir Mohamad said on Thursday Lynas will be allowed to keep running its local processing plant for rare earths, used in everything from headphones to defence products
The share had risen 15 percent on Wednesday after media in China, the biggest exporter of rare earths, reported that Beijing was ready to retaliate in its trade war with the United States by curbing supplies of the materials. and gas stocks .AXEJ lost the most, ending 1.4% lower, Santos Ltd STO.AX , Woodside Petroleum Ltd WPL.AX and Oil Search Ltd OSH.AX ended between 1% and 1.6% lower.
New Zealand's benchmark S&P/NZX 50 index .NZ50 rose 0.5% to close at 10,117.99.
Auckland International Airport Ltd AIA.NZ closed 1.7% higher while dairy giant a2 Milk Company ATM.NZ rose 1.2%.
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