A Mohr's circle is a graphical representation of the state of stress at a point in a material. It is used to determine the normal and shear stresses on different planes. The circle reduces to a point when the normal and shear stresses are equal and opposite along two mutually perpendicular planes. This condition occurs when there is a state of equal axial stresses on two mutually perpendicular planes, with no shear stresses.
Thus, the correct option is (4), where equal axial stresses on two mutually perpendicular planes, the planes being free of shear, lead to the Mohr's circle reducing to a point.