(Adds analysis, quotes, stocks on the move)
SYDNEY Jan 31 Australian shares were mostly flat on Friday in choppy trade and were due to post a loss this month, the first losing January in four years, as weak metal prices undercut an uptick in private sector credit.
Resource stocks pulled the market lower after copper and iron ore prices fell as the Chinese New Year holiday hampered demand for commodities.
BHP Billiton Ltd fell 0.4 percent and Rio Tinto Ltd lost 0.3 percent each.
Coal shipping ports in northeastern Australia remained closed on Friday after a powerful slammed into the coast in the early hours, packing heavy winds and generating giant tides, port officials said.
PanAust Ltd dipped 0.9 percent while NuCoal Resources Ltd tumbled 12 percent as the miner faces legal challenges regarding its licence at Doyle Creek.
The S&P/ASX 200 index slipped 3.1 points to 5,185.0 by 0100 GMT and is set to lose 1.1 percent for the week, its fourth consecutive week of losses. The benchmark fell 0.8 percent on Thursday.
Elsewhere the benchmark recovered from session lows following news private sector credit had increased by 0.5 percent in December.
"I think that's certainly helping, you've seen all the banks recover as well and that's certainly a key reflection of that," said John Milroy, division director at Macquarie Private Wealth.
"It points to the fact that the consumer might be spending a bit more."
Shares in Australian retailer David Jones Ltd jumped 4.5 percent after saying it had rejected a takeover approach from Myer Holdings Ltd worth A$1.4 billion in October 2013 and was no longer in talks.
Elsewhere, the financial sector recovered with two of the Big Four banks posting gains. Commonwealth Bank of Australia Australia and New Zealand Banking Group both eked out a 0.1 percent gain.
Overnight, the S&P 500 scored its biggest gain in more than a month on Thursday as Facebook led a tech rally and data showed the U.S. economy was on solid footing in the fourth quarter of last year, helping to offset broader losses in the local market.
Australian manufacturer Nufarm Ltd lost 1.5 percent to 9-month lows of A$3.94 after the company said it had agreed with a unit of Sumitomo Chemical Co to distribute Valent branded products in the United States from February 16.
Australia's sharemarket has shed 3.1 percent in January, a patchy start to the year as investors sold out of equities on slowing growth in China and the U.S. Federal Reserve continuing to taper its bond-buying program.
New Zealand's benchmark NZX 50 index rose 0.8 percent or 38.6 points to 4,888.4.
(Reporting by Thuy Ong; Editing by Eric Meijer)