The small black wire from the negative terminal is supposed to connect to a chassis ground. If it has melted and gives sparks when you touch it to chassis ground, you likely have a bad short to ground from the positive battery terminal cable or the red wire which goes to the alternator. Nothing happens without a cause. If this happened while you were turning, I'd look to see if the battery was loose in the tray. Maybe it shifted and caused one of the positive wires to touch tthe chassis. I'd look real close at the heavy positive cable to see if it is shorted to the chassis anywhere.