The UK stock market is showing the strongest signs of emerging growth and offers investors strong potential gains, according to HSBC.

In a new report, the bank points out that global investors will also get a powerful double whammy as the sterling/dollar exchange rate has broken its downward trend and seems likely to be a strong performer. An election is due that could be won by such a margin that, afterwards, taking sterling into European Monetary Union could be a safe bet at a time when the euro looks like a good currency. Among the stocks it believes are poised to make most progress are Vodafone, GlaxoSmithkline, BP Amoco, Prudential and Diageo. Vodafone shares, which will be swapped with Eircom shares on completion of the Eircell takeover, are currently trading at half their all-time high, with HSBC suggesting the stock is "a bargain" at these levels.