What you show is not cursor on the fringe, because you have the
continuation arrow on the fringe.  When the continuation arrow is
shown, the cursor cannot be shown on the fringe, because that slot is
already taken.  And anyway, the cursor is only shown on the fringe
when the line is not continued.

What you see there is Emacs displaying the small part of the cursor
that it still has available on the first screen line, probably because
your window-width is not an integral multiple of frame's
character-width.

IOW, I don't think I see anything abnormal in that image.