LONDON (REUTERS) - Manchester City exposed the first cracks in Arsenal's title challenge, beating the Premier League leaders 6-3 at the Etihad Stadium as their attacking talents cut loose in another free-scoring home display on Saturday.

City, whose early opener from Sergio Aguero was cancelled out by Theo Walcott, opened up a two-goal lead with Alvaro Negredo and Fernandinho efforts either side of halftime.

Arsenal briefly rallied with a superb second from Walcott, but David Silva restored the two-goal lead from close range and Fernandinho poked home his second to maintain City's 100 per cent home league record.

Even Per Mertesacker's late consolation for Arsenal was trumped by City as Yaya Toure stroked in a stoppage-time penalty.

Arsenal's lead at the top of the table was reduced to three points as City jumped to second, three points behind.