London's FTSE 100 Index dived more than 1% into the red today as ongoing fears over the Syrian crisis kept blue chips under pressure.
Ongoing excitement over Vodafone's imminent multi-billion pound exit from the United States failed to bolster the top tier, which closed 70.1 points lower at 6412.9.
The fall capped a dismal month for the FTSE 100, which has shed 3% since the start of August.
Investors continued to seek safety away from equity markets despite the imminent threat of US-led military action against Syria receding after t he UK Parliament voted against Britain's involvement.
The Government's defeat on action against Syria also caused a fall in oil prices, which sent energy stocks lower.
David Madden, market analyst at IG, said: "When it comes to war traders tend to fear for the worst, and just because the UK isn't getting involved is not to say there won't be a western invasion.
"Rather than run the risk, investors are taking their money out of the equity markets until political tensions lighten."
Falls on the London market were compounded by early session declines on Wall Street after disappointing economic figures on consumer income and spending, with the Dow Jones Industrial Average heading for its worst monthly slide in more than a year.
In currency markets, the pound was set for its biggest monthly gain against the euro in a year after more positive signs for the UK recovery.
Nationwide said house prices rose 0.6% in August, up 3.5% year-on-year, while Bank of England data revealed mortgage approvals for home purchases leapt to their highest level for more than five years in July.
Sterling held firm at 1.17 euros, up more than 2% over the month, although it dipped slightly to just under 1.55 US dollars.
Shares in Vodafone maintained their froth following yesterday's confirmation t hat it had resumed discussions over the potential sale of a 45% stake in Verizon Wireless.
Speculation over the potential deal, which analysts believe could be worth up to 130 billion US dollars (£84 billion), caused an 8% rise in its share price yesterday, leaving the mobile phone giant at its highest point since 2002.
Shares lifted another 1% or 1.5p to 206.3p amid hopes a deal will be announced next week
But oil stocks were hit after Brent crude fell below 115 US dollars a barrel, down from highs of 117 dollars a barrel earlier this week as the Syrian crisis took hold.
Petrofac was the biggest blue chip faller, down 38p to 1385p, while BP and Royal Dutch Shell fell 4.7p to 446.2p and 29p to 2173p respectively.
In other corporate news, Frankie & Benny's owner The Restaurant Group was 1.5p higher at 540.5p after reporting a 15% rise in half-year profits to £30 million.
The biggest FTSE 100 risers were G4S ahead 8.5p to 260p, Serco up 9p to 547.5p, Vodafone 1.5p higher at 206.3p and Antofagasta up 6p to 855p.
The biggest FTSE 100 fallers were Petrofac down 38p to 1385p, WPP off 32p to 1195p, Aviva 10.1p lower at 386.8p and Melrose Industries down 7.4p to 294.4p.