After the recent recovery on the German stock market, the Dax had to cope with another setback on Wednesday.

In early trading, the leading index lost 2.3 percent to 12,991 points, signaling an impending weak start to the stock market on Wall Street.

The M-Dax of medium-sized values ​​fell by 2.25 percent to 26,893 points.

The Eurozone leading index EuroStoxx 50 lost 2.04 percent.

Fed Chair Jerome Powell's speech to the Senate Banking Committee is likely to attract particular attention that day.

It follows Wednesday's highest rate hike in the US since 1994.

Fed central banker Thomas Barkin fanned new concerns about the economy on Tuesday evening.

The head of the Richmond Fed believes that a rapid return to a stable US economy is out of the question.

The US has been in relatively unstable times for about two years, Barkin said.

In view of the high inflation and bottlenecks on the labor market, it could take months or even quarters before stability is restored.

Sustained volatility is initially more likely.

At a previous event, Barkin said he thought a 50-75 basis point hike in interest rates at the next Federal Reserve meeting in July would be quite appropriate.

In view of the highest inflation in more than 40 years, the Fed raised its key interest rate in mid-June more than it had since 1994.

It approved an increase of 0.75 percentage points to the new range of 1.50 to 1.75 percent.

BASF course loses more than 4 percent

Among the individual values, there were only two companies in the Dax that were slightly up: the consumer goods manufacturers Henkel and Beiersdorf, which are considered to be defensive and therefore less susceptible to the economy.

BASF, on the other hand, brought up the rear with minus 4.3 percent.

According to CEO Martin Brudermüller, after a good first half of the year, the chemical company has to prepare for difficult times, as he said during the Industry Day of the Federation of German Industries (BDI).

The shares of Salzgitter AG held the red lantern in the S-Dax with minus 11.4 percent.

An industry study by the US bank JPMorgan weighed on it.

Analyst Luke Nelson downgraded the steel company's stock from "neutral" to "underweight" and lowered the target price from EUR 44.00 to EUR 31.60.

He referred to significantly lower prices and declining earning power.

Inventories in Europe and China are quite high and the economic outlook is poor.

As a result, Thyssenkrupp also gave in and fell by 6.4 percent.

The papers of the steel trader Klöckner & Co. lost 5.6 percent.