Market Report: FTSE 100 closes at its lowest point this year.

It may be less than 10 days until Christmas but there was no sign of a Santa rally yesterday as the FTSE 100 closed at its lowest point this year.

Falling oil prices have hit London’s leading market of late, with its constituents collectively losing more than £100bn in value last week. Despite an early bounce, it was more of the same on Monday as the market dipped 117.91 points – or 1.87 per cent – to 6,182.72.

“Oil certainly has the whip hand over the FTSE 100 at present, with the gainers of the morning in the energy sector fading rapidly away,” Chris Beauchamp, a market analyst at IG, said. “From this point onwards, volume is going to be on a downward trajectory, which points to increased volatility even if the coming sessions see something of a rally beginning to take shape.”

Oil-related stocks followed Brent lower again as the crude oil benchmark fell below $62 a barrel. Tullow Oil was off 8.5p at 358.8p, rival BG Group shed 23.9p to 795.1p and oilfield services company Petrofac fell 8p to 670p.

Aviva dipped 4.1p to 463.9p despite Citi throwing its weight behind the insurer. Analyst Kathy Fear named it her top pick in the sector, arguing the recent merger with Friends Life will “lead to robust dividend and cash flow growth”.

Catalytic convertor and chemical specialist Johnson Matthey also fell 26p to 3,175p as it announced it has sold its gold and silver refining business to Tokyo-based Asahi Holdings for £118m.

However, it wasn’t a bad day for everyone, and specialist engineer Weir gained 11p to 1,710p, helped by Deutsche Bank starting coverage of the company with a Buy recommendation. Deutsche believes Weir’s share price is taking into account a doomsday scenario for the US shale gas industry that it feels is highly unlikely.

Elsewhere, Dixons Carphone rose 4p to 425.6p ahead of the release of its first set of results as a merged company today.

The demise of rival Phones 4U is expected to have played into its hands and like-for-like sales are anticipated to have jumped 2.3 per cent in the UK and Ireland during the second quarter.