Dean Smith blamed a sub-standard first-half performance for Norwich’s failure to end the weekend at the Championship summit.

The Canaries would have gone above Burnley and Sheffield United had they won but instead lost 2-1 at Watford, who moved up from 17th to 10th thanks to goals in the first 31 minutes through Imran Louza and Keinan Davis.

Josh Sargent pulled one back directly before half-time but Watford held firm in an exciting second period.

“It was a big opportunity,” Smith said. “We could have gone top of the league but we have thrown that opportunity away because of the first half.

“It is very frustrating because they won too many duels, we didn’t get close enough in the first half.

“Watford deserved to win because of our first-half performance – we made it difficult for ourselves.

“Sargent got us a lifeline and we got the reaction we wanted after half-time. But that’s how we should have started the game.”

Louza’s luck initially appeared to be out when Norwich goalkeeper Gunn guessed correctly to save the midfielder’s early penalty and justify his selection ahead of Tim Krul, himself a specialist spot-kick saver.

Morocco midfielder Louza bounced back from that disappointment to volley his side ahead in the 18th minute from a cross from the excellent Ismaila Sarr, who had been bundled over by Liam Gibbs for the penalty.

“He is that kind of character – the penalty didn’t affect him,” said Watford manager Slaven Bilic of Louza. “If you want to control the game you need somebody like him, he was amazing also in his defensive work.”

Bilic was impressed with the way Louza had also shrugged off the fact that he has an FA charge for spitting at an opponent, from the previous home game against Swansea, hanging over him.

“I spoke to him and he said ‘no, I didn’t’ do it,” Bilic said. “I don’t even want to think about it.”

This was a second successive loss for Norwich, with Watford avoiding a third straight defeat. Bilic was delighted with the way his players had responded.

“The intensity was great, it was like a cup final,” he said. “We were so front-footed without the ball, with it we stretched it. Our first idea was to get the ball forward. The first half could have been three- or four-nil.

“It’s a drop in the ocean but you have to use this as your blueprint. Before (Saturday’s games) Norwich were joint top of the table.”

Smith was able to hand a belated debut at half-time to Isaac Hayden, the on-loan Newcastle midfielder, who had recovered from a pre-season knee injury.

“He felt he was ready to contribute, we were losing the physical battle in midfield and he was needed,” he said. “He’s a proper man, he can win the ball and knows how to use it.”

The decision to pick Gunn over Krul had also paid off. “It just felt right,” he said. “Over the last couple of games Tim will feel he could have done better with the goals. It is good for the culture of the team that everyone is on their toes.”

Sarr was the night’s star performer however, with Bilic switching him from his usual position on the right flank to wreak havoc on the left.

“He had good numbers on the right but sometimes you didn’t see him for 10 minutes,” the Croatian explained.