* Nikkei produces its fifth straight weekly gain
* Topix hits 10-year high, turnover at 5-month high
* Fast Retailing contributes hefty gains to Nikkei
* Event-driven funds likely chase market higher pre-vote - analyst
By Ayai Tomisawa
TOKYO, Oct 13 (Reuters) - Japan’s Nikkei share average surged to a fresh 21-year high on Friday, helped by index heavyweight Fast Retailing, while selling of Kobe Steel resumed as worries about its data fabrication scandal extended overseas.
Traders said that belief that the ruling party bloc will win Japan’s general election later this month underpinned overall market sentiment.
Kobe Steel Ltd dived 8.7 percent after the Nikkei business daily reported that more than 30 companies outside Japan were found to have received products with falsified specifications. For the week, the stock plunged 42 percent.
The company said on Friday it has also found cases of false certification in its steel division.
The Nikkei gained 1.0 percent to 21,155.18, the highest level since September 1996. For the week, the index rose 2.2 percent. This was the fifth week of advances, the longest such streak since November.
The broader Topix rose 0.5 percent to a 10-year high of 1,708.62 in heavy trade. Trading volume hit a three-week high of 1.85 billion shares and turnover was 3.28 trillion yen ($29.3 billion), the highest level since early May.
“This is an election play,” said Norihiro Fujito, a senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
“Such hedge funds as event-driven funds are likely chasing the Japanese market higher thinking that it won’t fall before the election. But they may take profits at the end of the next week.”
Media forecasts showed Prime Minister Shinzo Abe’s ruling bloc heading for a big win in a snap election on Oct. 22, assuring investors that his “Abenomics” programme of easy monetary policy, fiscal spending and promised structural reforms would continue.
Index-heavyweight Fast Retailing Co was the biggest contributor on the Nikkei benchmark index, rising 5.5 percent and after it posted a record profit for the fiscal year ended in August.
Automakers bucked Friday’s market trend, with Toyota Motor Corp declining 0.4 percent and Honda Motor Co dropping 0.6 percent. ($1 = 112.0300 yen) (Reporting by Ayai Tomisawa; Editing by Richard Borsuk)