LONDON (AFP) - Rafael Nadal showed he was getting back to his best as he crushed Andy Murray at the World Tour Finals on Wednesday with an impressive 6-4, 6-1 victory.

The Spanish fifth seed was dominant as the British world No. 2's game fell apart in front of a home crowd at the 17,800-capacity O2 Arena in London.

The first set of the group stage match was a high-level contest featuring impressive rallies and smart drop shots, but in the second, Murray's game fell away as Nadal turned the screw.

Nadal, beset by problems during the worst year of his career, at one stage slumped to 10th in the world - his lowest position since 2005.

But the 14-time Grand Slam champion showed how dangerous he could be in 2016.

"This is an important victory because that puts me in a good position to try to be in the semi-finals, and at the same time I have a big day against a great player on a tough surface," the 29-year-old clay court-lover said.

"The positive results, the good feelings on court in terms of enjoying myself, in terms of image, is much better.

"But it is just the beginning. I need to keep working so hard to try to keep going the same way.

"When I don't think about how to hit the ball, but when I think just about where to hit the ball, that's good news.

"Today, I feel free. I feel I'm enjoying it on court."

World No. 4 Stan Wawrinka of Switzerland takes on Spain's seventh seed David Ferrer in Wednesday's second match in the four-man group. Victory for Wawrinka, or for Ferrer in three sets, would ensure Nadal's place in the semi-finals.

"He's clearly playing better tennis now than a few months ago," Murray said of the Spaniard.

"A lot of the players still felt, providing he stayed injury-free, that he would raise his game again and compete at the top of the game.

"He's come back from tight situations which is signs he is getting back to where he wants to be."

Both Nadal and two-time Grand Slam champion Murray are contesting their seventh Finals, the season-ending tournament disputed on a hard court between the year's top eight players. Neither has ever won the competition.

After an early exchange of breaks, Murray produced a pair of scissors from his bag and chopped off part of his fringe.

"I had some hair in my eye, and I just wanted to get rid of it," he said.

Murray tried to get Nadal on the run with some drop shots but the Spaniard responded in kind by sending his opponent scampering around the court.

Murray held off break points at 2-3 and 3-4 down but eventually cracked when serving to stay in the set. Nadal broke to love, sending the Briton chasing about swiping at fresh air.

In the second set, Murray made 16 unforced errors to Nadal's three and won just 10 percent of the points on his second serve as the Spaniard raced away with the match.

"He was able to dictate most of the points," said Murray, 28.

"I didn't help myself out there. I served extremely low percentage, maybe lowest percentage I served the whole year in any match. That's not good enough against someone as good as Rafa." Murray will still be certain of finishing the season at number two, the highest year-end ranking of his career, if he beats Wawrinka in Friday's final round of group stage matches, while Nadal faces compatriot Ferrer.

In the other group, Roger Federer has already qualified for the semi-finals, while world number one Novak Djokovic needs to beat Tomas Berdych in his last round-robin match on Thursday.

Japan's Kei Nishikori could join Federer in the semis if he beats the Swiss great.

After the World Tour Finals, Murray will lead Britain's bid for a first Davis Cup title since 1936. Britain face hosts Belgium on a specially-laid clay court in Ghent in the Nov 27-29 final.