It can do given the right conditions but it's usually Myocilin that grows or similar varieties of fungus, but they tend to grow in damp and dark conditions so once they're on a proper light cycle it prevents the growth of fungus, plus, believe it or not, these fungi are actually beneficial to plant growth too, here, check this article out
http://www.bbc.com/earth/story/20141111-plants-have-a-hidden-internet
Straight after germination, once I potted my seeds, I have a few little fungi pop up here and there but I keep them in low light until the first leafs sprout, then when I transferred them to my grow box all the Myocilin died out.
No worries buddy, how are the roots looking so far? It seems to be a common thing for Kush strains to smell during veg, can't say I've ever experienced it before, but I've never grown Kush either, I do have a Lemon Haze in her like 7th or so week and she has a nice faint smell from time to time xD I'm not sure you're helping much by keeping the stem moist in all honesty, but it also won't do any damage either so it can't hurt, have you been misting the leafs during this process? As a plant has no roots (EG: with cloning) there's no other way for the plant to take in water so the leafs should be sprayed with plain, in-nuted water a few times a day until the plant is repotted (That's with clones, I imagine same rule applies here but it luckily worked out in your favor this time round, assuming you didn't mist them?)