* NZ jumps after cenbank shocks with big rate cut
* Gold stocks power ASX gains, other miners weigh
* Rare earths shine amid trade war gloom (Updates to close)
August 7 (Reuters) - New Zealand's stock market rallied on Wednesday after the nation's central bank stunned investors with a steep 50 basis point rate cut, while Australian shares snapped a five-session losing streak, powered by safe-haven gold stocks.
New Zealand's S&P/NZX 50 index .NZ50 finished 1.9% higher at 10,786.26. The benchmark rose sharply after the central bank jolted markets by cutting interest rates a steep 50 basis points and flagged the risk of going nuclear by taking rates below zero. retailer Mercury NZ MCY.NZ was the top gainer and closed at a record high.
The New Zealand move underscored how worried policymakers have become over the broadening impact of trade frictions.
Global risk assets were caught in a week-long sell-off after a dramatic escalation of the Sino-U.S. trade war, but a modicum of calm was restored when U.S. President Trump played down the prospects of the trade dispute being drawn out. MKTS/GLOB
Trump last week threatened further tariffs on Chinese goods, triggering the initial shakeout in markets which then went into a tailspin when Washington labelled Beijing a currency manipulator after it let the yuan slip past a key 7-per-dollar level to 11-year lows.
Signs of support for the yuan from China's central bank also helped ease investors' fears, though the currency slipped further in morning trade, keeping markets guessing.
Australia's S&P/ASX 200 index .AXJO ended 0.6%, or 41.4 points higher, at 6,519.5. The index tumbled 2.4% in the previous session.
Safe-haven gold stocks .AXGD rocketed to a record high close, as metal prices continued to rise on the uncertainty surrounding U.S.-China trade relations. GOL/
Gold miner Newcrest Mining NCM.AX rose 3.8% to hit its best level in nearly eight years, while peer St Barbara SBM.AX jumped 5.4% to end at a four-month high.
Australia's rare earths miners also rose against the backdrop of the trade war. China is the biggest supplier of rare-earths and it has previously hinted at limiting supply of these materials.
Rare earths miner Lynas Corporation LYC.AX gained 2.6%, while Northern Minerals NTU.AX and Alkane Resources Ltd ALK.AX were 1.6% and 1.3% higher, respectively.
On the downside, and reflecting the worries over demand, major mining stocks BHP Group Ltd BHP.AX and Rio Tinto (LON:RIO) RIO.AX closed 0.9% and 2.1% lower. China is the biggest buyer of Australian resources including iron ore and copper.
Energy stocks .AXEJ also remained subdued, with Woodside Petroleum WPL.AX closing 0.4% lower.
The banking index .AXFJ ended stronger but top lender Commonwealth Bank of Australia CBA.AX saw its worst close since early June after posting its first back-to-back annual profit decline in more than a decade, flagging further pain to margins from low interest rates and swelling costs. The stock lost 1.4%