Stocks defied the odds to deliver double-digit returns in 2012, a feat that would have been impossible but for the dividend appeal of Telstra and the banks. If there’s one thing the market can count on, it’s that dividends will maintain their allure, especially as the returns offered by cash, which faded quickly at the end of last year, will only deteriorate further if rate cuts come through in the first quarter as anticipated.

CIMB equity strategist Daniel Blake has a bullish target of 5100 for the S&P/ASX 200 Index in 2013. The index closed at 4648.9 on December 31; average net yield is about 4.6 per cent.