Wolves' unbeaten start to the season came to an end as third-placed Reading claimed a 3-0 victory at Molineux in the Coca-Cola Championship.
Mick McCarthy's side had previously dropped only two points from eight matches, winning their last seven, but they were undone after only four minutes when goalkeeper Wayne Hennessey punched the ball into his own net under pressure following a corner.
Andre Bikey made sure of the points by heading in a second (71) and Kalifa Cisse added gloss with a third two minutes from time.
Victory at Derby would have seen Birmingham move level with Wolves but Steve Davies struck three minutes from time to earn Paul Jewell's side a point after Quincy Owusu-Abeyie had put the Blues ahead (26).
Ferrie Bodde's 40-yard scorcher (19) and a Jordi Gomez penalty (80) meant Preston were on the wrong end of a 2-0 defeat, with Swansea bouncing back after their 4-0 loss to Reading at the weekend.
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