The game at the Vitality Stadium was eventually abandoned following a lengthy stoppage.
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Palmer unlocked a determined visiting defence when he poked home the ball from six metres after a one-two with Raheem Sterling in the 54th minute.
The draw kept City, who were without their league-leading scorer Erling Haaland due to a foot injury, in fourth place in the table on 34 points after a run of six games with only one win, and manager Pep Guardiola covered his face in frustration as the final whistle blew.
Amadou Onana and Michael Keane scored for the Merseyside club – who were docked points last month for breaching profitability and sustainability rules relating to losses – giving them 16 points and 16th place in the standings, seven points clear of the drop zone.
The score was one apiece when the captain fell to the ground with no other player near him.
Eddie Nketiah put Arsenal ahead three minutes before the break but the home side equalised five minutes into the second half through Yorbe Vertessen, who also struck the post in the first half.
Liverpool top the standings on 37 points, one ahead of Arsenal who face Aston Villa later on Saturday, after a game that centred on the sending-off of Eagles forward Jordan Ayew for a second yellow card after an innocuous infringement in the 75th minute.
A midweek victory over Chelsea had offered cause for optimism but in-form Bournemouth exposed just how far Ten Hag’s United have fallen this season.
Bukayo Saka and Martin Odegaard were on the scoresheet for Mikel Arteta’s side, who have opened up a four-point advantage over second-placed Manchester City in the division, albeit having now played a game more from the reigning champions.
Eddie Howe’s team climbed above Manchester United into fifth in the table on 26 points after 14 games as Erik ten Hag’s side dropped to seventh on 24.
An independent commission issued the penalty, and an appeal board will be appointed to hear the case.
Everton, meanwhile, argued that a financial penalty, or at worst a transfer ban, would be sufficient punishment.
Arnold’s position has been called into question since it was revealed that Sir Jim Ratcliffe is preparing to purchase 25 percent of the 20-time English champions.
The weekend’s headline encounter lived up the hype within the first 45 minutes in West London.
The win for Liverpool propelled them into second spot in the English Premier League for the 2023/2024 season.
Gary O’Neil’s decision to bring on Sarabia as a late substitute paid off handsomely as the Spaniard scored the equaliser in the 91st minute and provided the pass for the 97th-minute winner.
The Dutchman was shown his third yellow card of the season as Victor Lindelof scored the only goal to earn United their second league win in a row.
He scored in the 64th minute, firing past goalkeeper David Raya from close range after a goalmouth scramble.
After beginning the season poorly it had appeared Chelsea might have turned a corner with back-to-back Premier League wins over Burnley and Fulham before an impressive 2-2 draw with Arsenal.
Newcastle, who stretched their unbeaten streak to six games, are sixth in the Premier League with 17 points after 10 matches.