Former Man City man continues to impress with another couple of goals for his new San Siro employers.
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Balotelli gave Milan a ninth-minute lead from the spot after defender Salvatore Aronica had pulled the former Manchester City striker down in the box.
Milan should have extended their lead twice in the first half through Kevin-Prince Boateng and then Stephan El Shaarawy only for the pair to spurn their chances.
El Shaarawy made way for M’Baye Niang 13 minutes into the second half and the French teenager capitalised to set Balotelli up for his second of the match and seventh goal in only six games.
Given space to run down the left wing 18-year-old Niang fired the ball over for Balotelli, who pounced to smash the ball high into the net after the ball had deflected off a defender to land in front of Sorrentino.
AC Milan 1-0 Palermo (Balotelli)
AC Milan 2-0 Palermo (Balotelli)