Mining stocks were the talk of the London market yesterday as the FTSE 100 languished in negative territory.

News that Xstrata had drawn a line under its troubled bid for Australian miner WMC Resources made the stock one of the highest blue-chip climbers.

However, this sent shares in a number of rivals tumbling and contributed to the Footsie closing down 16.3 at 5010.9.

Xstrata ruled out increasing its 289p per share offer for WMC for a second time after rival BHP Billiton tabled a higher bid.

The news sent Xstrata 21p higher to 1061p, but BHP Billiton fell 9p to 740p. Rival Rio Tinto was also among the heaviest Footsie fallers, down 26p at 1825p by the close.

Trading across the Atlantic also had a negative impact, with the Dow Jones Industrial Average slightly lower by the end of the day in London.

Those doing their best to lift the mood included logistics group Exel, which was the highest Footsie climber after a positive broker note from Credit Suisse First Boston. The stock climbed 20p to 874p.

It was followed by BAE Systems, which recovered some of the ground lost on Monday following a share issue needed to part-finance a £2bn acquisition. BAE rose 5p to 251p, a gain of more than two per cent.

Another riser was British Airways, which gained nearly two per cent, or 4p, to close at 281p, after announcing that former Aer Lingus boss Willie Walsh would replace departing chief executive Rod Eddington.

Elsewhere, a number of retailers were lower after the British Retail Consortium announced that last month like-for-like sales fell 0.3 per cent amid tough conditions for DIY and electrical retailers in particular.

Fallers included Dixons, off 3p at 155p, and B&Q owner Kingfisher - down 2p at 292p.

In the FTSE 250, ports and ferries group P&O was out of favour after announcing losses of £210m for last year because of the cost of a major shake-up at its ferries business.

Shares in the company led the second-flight fallers, retreating nearly six per cent, or 18p, to 301p.

French Connection shares were also under pressure, down four per cent, or 11p, to 304p, following its announcement of a further deterioration in sales.

But shares in the RAC rallied to an all-time high after it said it had received an approach that could lead to a takeover offer. The 108-year old company, which started life as the Royal Automobile Club, saw its stock move 19 per cent higher, up 138p to 880p.

Fellow second rank stock Aegis announced a 17 per cent jump in underlying profits as it reaped the rewards of expanding its media and research services. Investors in the marketing group reacted positively, pushing its shares up four per cent, or 4p, to 105p