Australian cycling star Michael Matthews was furious after his Tour Down Under overall hopes were dashed by a mechanical problem.

Matthews angrily confronted American rider Magnus Sheffield at the end of the second stage.

“We came to the final climb … I don’t even know what’s happening in cycling these days, there’s just no respect in the bunch,” Matthews told the Seven Network immediately after finishing.

“I was in a great position. I got hit from one side, hit from the other side and I dropped my chain.

“I couldn’t get it out and I couldn’t make my time back.”

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Rohan Dennis won the drama-packed stage and took the lead, with a three-second advantage on general classification over fellow Australian Jay Vine.

The 2015 Santos Tour winner broke away from four others in a talent-packed lead group to win the 154.8-kilometre stage from suburban Brighton to Victor Harbor, south of Adelaide.

Matthews, the strongest rider in the race, had his overall chances dashed when he suffered his mechanical problem at a crucial point in the race.

Previous race leader Alberto Bettiol also dropped out of contention when he appeared to have leg cramps and, like Matthews, lost contact with the peloton.

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With just over 20 kilometres left, and just before the last climb of the day at Nettle Hill Road, Matthews crucially had his chain come off.

Before then he had picked up more bonus seconds earlier in the stage on the intermediate sprints.

But he finished the stage well behind the peloton, meaning his overall chances are gone.

Bettiol (EF Education) had his own problems, losing contact with the peloton when he appeared to suffer cramp and even stopping briefly with 11 kilometres left.

As Matthews dealt with his disaster, Jayco-AlUla teammate Simon Yates cleverly joined the talent-packed break that formed on the Nettle Hill Road climb.

Reigning Giro d’Italia champion Jai Hindley (Bora-Hansgrohe), newly crowned Australian time-trial champion Jay Vine (UAE Team Emirates), Dennis (Jumbo Visma) and Swiss Mauro Schmid (Soudal Quick-Step) also went on the attack.

Yates sat at the back of the breakaway until just under 4 kilometres left when he started to contribute to the attack, clearly having received word over the team radio that Matthews would not bridge the gap to the peloton.

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As the five leaders built a lead of more than 30 seconds, Australian Luke Plapp (Ineos Grenadiers) led the peloton’s frantic chase.

But the breakaway stayed clear and Dennis launched a solo charge late to take the stage.

He leads Vine, who was second on the stage, by three seconds overall.

It is a welcome morale boost for Dennis’ Jumbo-Visma team after its Dutch star Robert Gesink crashed out of the race on Tuesday with a fractured pelvis.

Three more riders pulled out of the Tour after Tuesday’s flurry of crashes during stage one.

Australian Graeme Frislie (National Team) and Belgian Jordi Meeus (Bora-Hansgrohe) did not start on Wednesday because of concussion, while Australian Chris Harper (Jayco-AlUla) is out with an AC Joint injury.

-AAP