Manchester City manager Pep Guardiola gave credit to Wolves and admitted his team struggled to deal with transitions after the Premier League leaders lost at Molineux to surrender their unbeaten Premier League record.
City went behind in the first half through a Ruben Dias own goal before their opponents had registered a single shot on target. Julian Alvarez brought them level early in the second half, only for Hwang Hee-chan to restore the hosts' lead.
Gary O'Neil's men hung on for all three points, stopping City's perfect start after six wins from their first six games. Guardiola's team are still top of the Premier League table, but Arsenal have closed to within a point of last season's treble winners after a comfortable win of their own at Bournemouth.
"Congratulations Wolves, they deserved it," Guardiola said. "We had chances and struggled to deal with transitions and they played very well.
"We were there and settled well and the question is when the opponent is faster and quicker, we have to accept it," he added. The Catalan also addressed City's injury issues, saying: "Bernardo [Silva] is soon to come back and John [Stones] is soon to come back and we will see how many players we have for the Champions League."
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Guardiola wasn't reading too much into the fact it was City's second straight defeat after a midweek EFL Cup exit at the hands of Newcastle. "Different competitions," he said." At Newcastle [we] were miles better than today and now we go onto the next one."
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Hwang Hee-chan scored Wolves' winner against Manchester City (PA)Wolves star Pedro Neto indicated after the game that his team knew they had a chance to upset the champions. "Up front we have very good players. We know that we could have the opportunity on the counter," he said.
"We are playing against the best team in the world but we had belief that this could be a turning point for us. We work hard and we take the three points."
Guardiola's City team will have a chance to rebound from their surprise defeat on Wednesday when they take on RB Leipzig in the Champions League. The Champions League holders came from behind to beat Red Star Belgrade in their group stage opener, but were held in the first leg of their last-16 tie in Leipzig last season before demolishing the Bundesliga side 7-0 at home.