Zardari swept to victory with overwhelming support from members of the two-chamber parliament and four provincial assemblies, replacing former army chief Pervez Musharraf, who resigned last month nine years after taking power in a coup.

As votes were cast, tremors from an earthquake centred on Afghanistan shook the capital Islamabad. Underscoring the problems Zardari faces, a suicide car bomber killed at least 30 people in an attack on a police post in the north-western city of Peshawar. At least five of the dead were policemen, and the blast wounded dozens more.

Investors and foreign allies, led by the US, hope the election will bring some stability after months of political turmoil and rising militant violence. The uncertainty has dragged stocks and the rupee sharply lower.

A former businessman, Zardari is close to the US and has stressed Pakistan's commitment to the widely unpopular campaign against militancy.

Zardari, who had been widely expected to win, secured two-thirds of the votes, according to official Election Commission results. He is expected to be sworn in early this week.

A polo-playing playboy in his younger days, Zardari spent 11 years in jail on corruption and murder charges. He was never convicted and denied any wrongdoing, but faces widespread doubts about his suitability to be president.

At a gathering with party colleagues, Zardari hailed his victory as the completion of the democratic process. "To those who would say the People's Party, or the presidency, would be controversial under our guardianship, under our stewardship, I would say: 'Listen to democracy'," he said, flanked by his two daughters.

Their mother was killed in a suicide attack on December 27, weeks after returning from years in exile. Her Pakistan People's Party (PPP) now holds the presidency and leads the government.

Zardari, 53, will have to contend with a host of problems in the nuclear-armed US ally, including militant violence and an economy in tatters.

The bomb in Peshawar destroyed the police post and brought down roofs of buildings, leaving some people trapped under the rubble, provincial police chief Malik Naveed Khan said. The bomber's target was probably the provincial assembly, where members were voting, he said. Pakistani Taliban claimed responsibility.

Zardari was thrust into the centre of politics by his wife's assassination. A February parliamentary election win for the PPP made him one of the most powerful figures in the country.

His decision in August to begin impeachment proceedings against Musharraf led to the latter's resignation.

His two rivals in the vote were Saeeduzzaman Siddiqui, a former judge, nominated by former prime minister Nawaz Sharif's party, and Mushahid Hussain Sayed, from the party that backed Musharraf and ruled under him.

Zardari will take office as anger against the US is boiling after a bloody incursion by American ground troops into a remote village on the Afghan border on Wednesday. He will walk a tightrope between reassuring the US on his efforts against militancy while calming public anger.

In a show of indignation over the raid, authorities blocked a major fuel supply route for western forces in Afghanistan, defence minister Chaudhry Ahmed Mukhtar told Dawn TV.

Most fuel and other supplies for US forces in Afghanistan are trucked through Pakistan, crossing the border at two points: Torkham, near Peshawar, and Chaman to the south-west. The Chaman crossing, where supplies cross into the Afghan south, was operating normally.

Political uncertainty, exacerbated by a split in the PPP-led coalition last month, together with security and economic worries, has sapped investor confidence and dragged Pakistani stocks down 34% this year.

The main index rose 1% on Friday, helped by optimism that the vote would bring clarity. The rupee has lost 20% to the dollar this year, but also firmed on Friday.

Some commentators fear rivalry with Sharif, head of the country's second biggest party, could herald a return to the tumultuous politics of the 1990s.

"The real test has begun," said retired teacher Sajjad Ali Shah. "Terrorism and the economy will have to be controlled. If they (manage that], they could go a long way. But if not, they'll be out in two years." US Secretary of State Condoleezza Rice welcomed Zardari's election and praised his emphasis on fighting terrorism.

Speaking to reporters travelling with her in Africa, Rice said she was looking forward to working with Zardari, adding she had spoken to him on the phone but had not met him.

She said: "I was impressed by some of the things that he said about the challenges that Pakistan faces, about the centrality of fighting terrorism and about the fact that the terrorism fight is Pakistan's fight."

Meanwhile, Britain offered to work with Zardari. In a statement issued in London, the Foreign Office said:

"We want to work with the government to support measures that promote stability, democracy and the rule of law."