You've created a huge short circuit hence the smoking cables.
The worst case scenario is that you've wrecked both batteries or possibly shortened their lives.
It all depends how long you had them connected like this.
They are designed to handle high currents, but only for short periods.
Was the other car able to start up ok afterwards?
Try charging the battery up on a trickle charger and see what voltage its holding after its fully charged .
If its below 12.5 volts then its probably been damaged.
The cars electronics should be ok though.