The blast in a neighbourhood in eastern Kabul was heard throughout most parts of the city. There were no immediate details on casualties from the explosion.
No group has taken responsibility so far. The suspected attack would be the 18th to take place in Kabul since the beginning of the year. At least 193 people have died and at least 897 others have been injured in the attacks.
The explosion came as US Special Representative for Afghanistan Reconciliation Zalmay Khalilzad was in Kabul to discuss nearing a peace deal with Taliban militants.
Khalilzad said a deal could be announced within the next few days. Both sides have in principle agreed to a peace agreement, but the draft will not be final until US President Donald Trump agrees to it, the envoy said during an interview with local broadcaster ToloNews.
The US will withdraw 5,000 US soldiers from Afghanistan in 135 days as a first instalment if a peace deal with the Taliban is finalized, he said.
Despite the possible deal, Afghan forces and Taliban fighters continued battling in Afghanistan's north-eastern Baghlan province on Monday after the militants launched an attack on the provincial capital a day earlier. 
At least eight people, including four security force members, have been killed since the fighting began Sunday in the provincial capital Pul-e Khumri, the head of the city's public hospital, Dr Mohammad Anwar Wardak, told dpa. 
Some 55 others, including 21 security force members, were wounded, he said.
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