This often happens in MM7. The monster is "in the wall", it can attack from the wall, it cannot be attacked by you and it is a living monster for the game (thus preventing you from completing "kill'em all" quests).You can usually get the monster from the wall by leaving the map and returning. This will reset all living beings in the area to their starting positions (which are ouside the walls).
In your case, you need to leave Stone City completely and return. The best choice seems to be entering the Tunnels to Nighon and returning. Another possibility is leaving to Barrow Downs and returning. Going to "civilized parts" of Stone City and returning will not work because you haven't changed the map.
Note that you only need to leave and return. You need not explore the new area, wait there or do there something else. It's enough to enter the new area, turn back and enter the just left area again.
