* reuters://realtime/verb=Open/url=cpurl://apps.cp./cms/?pageId=stock-index-poll Reuters poll data
* Nikkei will likely end year 7 pct higher from 2016
* Risks in first half of 2017 include French election
* Trump expected to turn focus to stimulus in second half of 2017
By Ayai Tomisawa
TOKYO, March 29 (Reuters) - Japanese stocks could step back before mid-year as uncertainty over the U.S. legislative agenda and elections in Europe slow recent modest momentum but they are expected to finish the year up around 7 percent, a Reuters poll found.
Market participants say anticipated U.S. interest rate hikes this year could strengthen the dollar against the yen, a positive for Japanese equities, even as the Bank of Japan is expected to eventually start moving away from its ultra-easy monetary policy, perhaps as soon as this year.
The Nikkei share average is forecast to trade at 19,000 at end-June 2017, compared to Tuesday's close of 19,202.87, according to the median in a poll of more than 20 analysts taken by Reuters in the past week. It will then reach 20,500 by the end of the year.
The benchmark index closed out 2016 at 19,114.37.
Forecasts for mid-2017 ranged from 16,500 to 22,000. They were 12,000 to 24,000 for the end of the year, and 9,000-26,000 for June 2018.
On Monday, the Nikkei skidded to more than six-week lows after the perceived safe-haven yen rose to its strongest level since November against the dollar as U.S. President Donald Trump's failure to pass a healthcare bill raised questions about his ability to push through tax cuts and fiscal spending to boost the economy.
Another near-term risk is the French presidential election on April 23, analysts said.
"There is about 40 percent chance that the Nikkei may fall below 18,000 before June. The key negative risks include Trump's protectionist trade stance as well as the French presidential election," said Akio Yoshino, chief economist of the investment management division at Amundi Japan.
He said a victory for far-right National Front leader Marine Le Pen in the French presidential election would be negative for French and European stocks, and may have repercussions for Asian shares. Current opinion polls show it will be won by independent centrist Emmanuel Macron.
Japanese equities have made double-digit percentage gains since Trump's election on hopes his administration will boost U.S. economic growth to 3 percent or even higher.
Analysts said in the longer term, investors will buy Japanese cyclical stocks such as exporters as the dollar gains against the yen thanks to rising U.S. interest rates.
A cheaper yen makes Japanese exporters more competitive abroad and lifts their profits when repatriated.
Also benefiting from stronger U.S. economic footing are Japanese financial stocks - such as banks and insurers - as they seek to boost returns from higher yielding U.S. bonds, they said.
"After many twists and turns, I think Trump will focus on his economic policies in the fall. I expect the dollar to trade above 115 yen and the Nikkei will likely regain momentum," said Takuya Takahashi, a strategist at Daiwa Securities.
For other stories from the Reuters global stock markets poll Additional polling by Vartika Sahu and Vivek Mishra; Editing by Jonathan Cable & Shri Navaratnam