By 1215 GMT equities traded up 1.11 percent to 29,272.42 points, breaching the 29,000 level, and outperforming the MSCI emerging equities index which gained 0.73 percent.
The lira, down 4.7 percent since the start of 2009, strengthened to 1.612 from a close of 1.6455 on Wednesday.
This weekend Economy Minister Mehmet Simsek will meet top IMF officials in
Frustration over the length of negotiations continues but the market is positive a deal is now within sight, with most expecting an accord worth $50 billion after talk of an initial $15-$20 billion.
"Some positive remarks and possible developments on the IMF's expected visit to
"The strength of Turkish equities may linger until the signing of IMF deal yet we do not think it is sustainable therefore we advice investors to use recoveries as a selling opportunity," they added.
The market has gained 9 percent since the start of the year.
Top traded share Garanti Bank rose 1.97 percent to 3.10 lira, while the banking index rose 2.45 percent, lifted by some positive news from its international banking peers.
The yield on the benchmark bond, maturing on Feb. 2, 2011, fell to 12.32 percent from Wednesday's 12.41 percent.