The Shanghai Composite Index (SCI) posted a 2.3% gain to close at 2633.66 points on Wednesday, its highest level in two months, the Wall Street Journal reported. The gain adds substance to a broader rally which has seen the SCI rise 11% since its nadir on July 5, when concerns that the global recovery had stalled and uncertainty about China’s monetary and fiscal tightening sent the market tumbling 27% for the year. Analysts attribute the recent rise to investor optimism that efforts made by Chinese officials to cool the economy in the first half of the year will taper off and the domestic economy will stabilize. However, Arjuna Mahendran, head of investment strategy for Asia at HSBC Private Bank, predicted that the stock recovery could be derailed if the government proved unable to control inflation.