With the fiscal cliff behind us and Europe under control, it's smooth sailing ahead for stocks -- right?

Well, not quite. Plenty of bugaboos and old ghosts will come back to haunt the market and spark major sell-offs in 2013 -- including tensions over Iran's nuclear program, eurozone debt problems and, yes, Fiscal Cliff II, the remix.

Other major events and trends I foresee for 2013: Emerging markets will outperform, gold will spike to $2,200 an ounce, companies will finally start spending their cash, bank stocks will outperform (surprising just about everyone), and the U.S. may lift its trade embargo against Cuba.

And 5% to 10% pullbacks caused by these events -- we'll likely see this level of damage in the first half of the year, maybe more than once -- will be buying opportunities. That's because the economy will stay on track, finally restoring the confidence of businesses and investors. That will leave stocks 10% to 15% higher by year's end. So keep some powder dry.

Here's a closer look at the major events and trends of 2013 -- and how to play them.

Stocks advance and win over investors

It may be hard to square with what you hear -- that steady drumbeat of scare stories about Europe, the fiscal cliff, the debt ceiling and other economic woes -- but we're actually four years into a huge bull market. Because of all those bugaboos, much of the public remains skeptical. This will change, and investors will adopt a more bullish stance in 2013, pushing stocks higher even as the economy posts merely lukewarm 2% to 3% growth.

"A slow but steady rise in confidence will likely drive the Standard & Poor's 500 Index ($INX) above its previous all-time high of 1,565, and perhaps even as high as 1,700," predicts James Paulsen, a market strategist and economist with Wells Capital Management. "The turbulent political environment that curtailed corporate risk-taking in 2012 will end," agrees David Kostin, the chief U.S. equity strategist at Goldman Sachs.

History supports a positive take on stocks for 2013. That's because bull markets that survive four years typically go on for a fifth, says Thomas Lee, the chief U.S. equity strategist at JPMorgan Chase. Of the 12 bull markets since 1935, eight have lasted for at least four years, and of those, five continued on into a fifth year.

How to play this? As confidence returns, investors will get out of "safe haven" stocks in utilities, consumer staples and telecom services. So, it's best to avoid these areas. Another reason to stay away: These groups look overvalued now because so many people have run to them for safety, says Kostin.

In contrast, investors will move into the more economically sensitive or "cyclical" kinds of companies they've been avoiding because of all the economic fears.

Thus, it makes sense to buy stocks in these sectors now, ahead of the move into these stocks by other investors, says Lee. Once again, history supports this. Cyclical stocks -- in areas such as basic materials, industry, technology and consumer discretionary goods and services -- typically outperform in the fifth year of a bull market.

Top picks of JPMorgan Chase analysts in these areas include: Goldcorp (GG) and Carpenter Technology (CRS) in metals; MeadWestvaco (MWV) in paper products; LyondellBasell Industries (LYB) in specialty chemicals, Robert Half International (RHI) in human resources; Quanta Services (PWR) in construction and engineering; Canadian Pacific Railway (CP), Texas Roadhouse (TXRH) and Brinker International (EAT) in restaurants; PulteGroup (PHM) in homebuilding; Target (TGT) and Urban Outfitters (URBN) in retail; Harley-Davidson (HOG) in recreational vehicles; Wyndham Worldwide (WYN) in hotels; and Oracle (ORCL), Texas Instruments (TXN) and Cree (CREE) in technology.

Companies finally unleash their cash

That return of confidence will have U.S. companies making use of their huge cash hoards, in a capital spending spree that will have them upgrading plants, equipment and software.

Companies will also be pressed to raise their spending for another reason, predicts James Swanson, the chief investment strategist at MFS Investment Management. Capital spending has been stuck at abnormally low levels, he says. In fact, it is around 6% of sales, which is toward the low end of the 5.1% to 8.1% range of the past 16 years, according to analysts at JPMorgan Chase.

This helps explain why industrial capacity usage in the U.S. currently stands at 78% -- a red-flag zone. Economists consider 80% to be full capacity -- the point at which companies are pressured to start expanding to avoid bottlenecks. "At the current economic growth rate, we will be at 80% next year," says Swanson. "Companies have been waiting and waiting. At some point they will have to freshen up."

He thinks that will happen this year. The potential here is huge, because nonbank companies in the S&P 500 hold about $1.2 trillion in cash.

A capital spending spree will be good for companies that sell the tools, motors, valves, switches and other equipment used in plants and factories, like Emerson Electric (EMR), Illinois Tool Works (ITW) and Danaher (DHR). But it will also help tech companies, since businesses will want to spend on tech to maintain efficiency and profit margins. "The installed software base is the lowest ever," says Swanson. Thus, an upturn in capital spending should boost sales at companies selling business-related software and storage, such as Microsoft (MSFT), VMware (VMW), EMC (EMC) and Oracle. (Microsoft publishes MSN Money.)

Emerging markets outperform

Investors have shunned emerging-market stocks on worries about a slowdown in China and elsewhere. Thus, developing-market stocks trailed U.S. stocks in 2012.

But that will change. The reason: In an effort to spur growth, emerging-market central banks have been cutting interest rates and easing monetary policy for six months. The effects of such moves usually take eight to nine months to kick in. So, by the second quarter, we should start seeing faster emerging-market growth, says Swanson.

Another factor that will boost growth is increased spending by the expanding middle classes in emerging-market economies. "The growth will be stronger than what the market has priced in," predicts Swanson.

"Emerging-market stocks will likely provide the best returns in 2013," agrees Paulsen. "These economies still offer the fastest growth available in the world."

Market strategists at Goldman Sachs, who agree with this take, suggest owning U.S. companies with lots of exposure to these regions. Their list includes Agilent Technologies (A) in diagnostic and measurement equipment; Noble (NE) and Schlumberger (SLB) in energy equipment and services; NII (NIHD) in mobile phones; Nike (NKE) in apparel; Texas Instruments and Emerson in technology; Wynn Resorts (WYNN) in casinos; cigarette giant Philip Morris International (PM); Maxim Integrated Products (MXIM) in semiconductors; and Yum Brands (YUM), which has a big presence in China with its KFC chain.

Bank stocks continue to come back, big time

Financials were the best-performing sector last year, but banks are still widely despised and mistrusted, given their leading role in the credit meltdown. Exhibit No. 1 supporting this: Major banks like Citigroup (C), Morgan Stanley (MS), Goldman Sachs (GS) and JPMorgan Chase (JPM) all trade below book value even though, like 'em or not, they have strong franchises and they are here to stay.

"I think the average person on the street still thinks you're crazy to own financials," says Anton Schutz, who manages the Burnham Financial Industries (BURFX) fund, which has outperformed competing funds substantially over the past five years.

Thus, they still look cheap, especially considering that business should pick up substantially in 2013 as economic growth continues and the capital markets return to normalcy, spurring core banking activities like initial public offerings and mergers and acquisitions, predicts Schutz.

He particularly likes Citigroup and Morgan Stanley because they look so cheap, and also because they will probably resume share buybacks and dividend payouts in 2013. Among smaller regional banks, he likes Regions Financial (RF). It appears to be cheap and also has a lot of exposure to the housing sector via mortgages, so the ongoing rebound there will help.

Banks will also benefit from that overall return of confidence among investors and businesses that Paulsen expects. "The business of finance is all about confidence," he says. "You don't take out a loan without it."

Familiar ghosts will spook the markets

It may seem that the fiscal cliff is behind us, but don't be fooled. There are still plenty of budget problems to work out.

In fact, Fiscal Cliff II lurks just around the corner. The U.S. Treasury can juggle payments to make it through to the end of February without hitting the federal debt ceiling. "At that point the federal government cannot sell any more Treasurys to raise money to fund itself," says Fred Dickson, the chief investment strategist at D.A. Davidson, a brokerage.

You may recall that a standoff on the debt ceiling led to a downgrade of U.S. debt and severe market turbulence in the summer of 2011. "It will be déjà vu all over again," predicts Dickson. "It's going to be a major trigger of market nervousness, probably escalating in mid-January through the end of February."

Even if the debt ceiling gets resolved cleanly, the U.S. could still see another debt downgrade because of the lack of spending cuts in the resolution of the first fiscal cliff, predicts Brian Frank, manager of the Frank Value Investor Fund (FRNKX).

Next, Europe will be back as a market-rattling issue. Greece, Portugal, and Spain will have trouble hitting spending limits tied to rescue loans, Dickson predicts. And their economies won't grow enough to raise tax takes to bail them out. This will jeopardize the flow of additional lending and spark another crisis, probably in the second quarter, Dickson believes. "It is just a bad script," he says. Meanwhile, national elections in Italy in February and Germany in October may bring out the kind of anti-European rhetoric from candidates that can spook the markets, notes Brian Jacobsen, the chief portfolio strategist at Wells Fargo Funds Management.

I think the key takeaway here is that any 5% to 10% U.S. stock market declines that result from various scares will be good buying opportunities. U.S. and European debt problems will ultimately be resolved or kicked down the road again, and the U.S. economic rebound won't be thwarted. So keep some cash on hand to buy pullbacks.

Tensions around Iranian nuclear program heat up

At some point this year, Iran will announce it has enough enriched uranium to produce a nuclear weapon, predicts Byron Wien, a strategist with Blackstone Advisory Partners. Oil markets will get the jitters because of fears of a decisive military response from Israel and the U.S. While the odds of an Israeli strike on Iran are fairly low, at 20%, says Mark Zandi, the chief economist at Moody's Analytics, tensions surrounding all this will send oil prices soaring. Oil might go as high as $115 a barrel for West Texas Intermediate and $120 for Brent Crude, predicts Dickson, the chief investment strategist at D.A. Davidson.

You could buy funds that track the price of crude, like United States Oil (USO) and PowerShares DB Oil (DBO), as a play on an oil spike. But getting the timing right might be difficult.

Instead, it's better to look at this as a reminder to own some energy stocks, either as a trade on a spike or as a long-term hold. Paul Larson, the chief equity strategist at Morningstar, thinks the drilling equipment supplier National Oilwell Varco (NOV) looks cheap, so that's one way to go. He thinks the company will benefit from a rise in natural gas prices in North America over the next few years. Analysts at JPMorgan Chase put Denbury Resources (DNR), Suncor Energy (SU) and Schlumberger at the top of their favorite energy plays for 2013.

Gold spikes to $2,200 an ounce

Ongoing expansion of the money supply by the Fed will continue to create worries about inflation and the financial soundness of the U.S. This will have investors running to gold as a hedge against inflation and overall market risk at some point in 2013, causing the price of the metal to spike.

"We think that so long as U.S. dollar creation exceeds GDP growth, gold prices should increase," says Thomas Winmill of the MidasFund (MIDSX). He thinks gold could trade up to $2,200 an ounce, for a 32% increase from current level of about $1,660. He believes the average price will be $1,950, a 17% increase.

Monetary easing by the European Central Bank will also stoke gold prices by contributing to worries about inflation, says Bank of America Merrill Lynch Global Research investment strategist Michael Hartnett, who has a price target of $2,000 per ounce on gold for 2013.

Spikes in gold would boost gold mutual funds like Winmill's Midas Fund. Gold exchange-traded funds like iShares Gold Trust (IAU) and Market Vectors Gold Miners (GDX), which tracks a basket of gold mining stocks, would also benefit.

A gold price spike would also boost shares of Newmont Mining (NEM), the world's second-largest gold producer and a top holding of Winmill's, which has major mines coming online in Peru and Ghana through 2015. It would also benefit shares of Harmony Gold Mining (HMY), which have been beaten down on fears of nationalization of gold mines in South Africa, where it operates. Those fears are overblown, so Harmony Gold Mining is a buy, says Byron King, the editor of Outstanding Investments.

At the time of publication, Michael Brush owned shares of the following companies or funds mentioned in this article: Philip Morris International. He has recommended Philip Morris International, Citigroup, JPMorgan Chase, National Oilwell Varco and NII in his investment newsletter.

Michael Brush is the editor of Brush Up on Stocks, an investment newsletter. Click here to find Brush's most recent articles and blog posts.