U.S. troops raided the home of a suspected weapons dealer on Sunday, arresting him and seizing blasting caps and other materials often used by Iraqi insurgents to build the roadside bombs that target American soldiers.

As Apache helicopters (search) hovered overhead, troops backed up by Bradley fighting vehicles battered down the front of the house in central Tikrit (search), looking for a man identified by fellow Iraqis as a weapons dealer and possible member of the Saddam Fedayeen, the regime's former militia.

Inside, they found bomb-making materials and detained two people, including the suspected dealer. The raid took place near the site of an Oct. 1 roadside bombing that killed a woman soldier serving with the 4th Infantry Division.

However, it was premature to say if the two suspects arrested at the house were connected to the attack that killed 21-year-old Pfc. Analaura Esparza-Gutierrez, Major Mike Rauhut, executive officer of the 4th Infantry Division's 1st Brigade 22nd Infantry Regiment, told The Associated Press outside the house.

"We had targeted an individual we were looking for and we did find him at this home, along with some incriminating paraphernalia and bomb-making material," Rauhut said.

As he spoke, soldiers used metal detectors to sweep the home's wall-enclosed courtyard while others searched through the two floors of the house.

U.S. troops have intensified their hunt for bomb makers and their bankrollers following a recent increase in roadside attacks against American convoys and patrols, which have killed seven soldiers from the 4th ID, based in Fort Hood, Texas, over the past three weeks.

On Saturday, a U.S. soldier from the 4th ID was killed and another was wounded in an ambush in Sadiyah, 60 miles north of Baghdad. The death brought to 88 the number of American soldiers killed by hostile fire since President Bush declared major combat over on May 1.

Elsewhere, former Iraqi soldiers angry over rumors their pay would be cut off clashed Saturday with coalition troops in Baghdad and in the southern city of Basra in riots that left two Iraqis dead and dozens injured. Coalition officials said Saddam Hussein supporters fomented the violence.

The trouble started in Baghdad when hundreds of ex-soldiers assembled Saturday morning at a U.S. base at the city's former downtown airport to collect a one-time $40 stipend, which the coalition has been paying since Saddam's army was disbanded in May. The crowd began hurling stones at U.S. troops and Iraqi police, who fired shots to try to disperse them.

Some of the rioters moved to the nearby Mansour district, where they burned and looted four liquor stores and set fire to an Iraqi police car in the upscale neighborhood. Back at the U.S. base, an Iraqi police colonel finally persuaded most of the crowd to line up in an orderly fashion so they could receive their pay from the Americans.

One ex-soldier died from a gunshot wound to the head and 25 people were hurt during the Baghdad riot, according to Dr. Abbas Jafaar of the city's al-Yarmouk Hospital (search). U.S. officials said there were some injuries to coalition troops.

Meanwhile, in Basra, Iraq's second largest city, coalition spokesman Maj. Niall Greenwood said one protester was shot and killed by British troops when ex-soldiers rioted after hearing rumors that Saturday was the last day they would receive stipend payments.

Coalition officials in Baghdad blamed loyalists for provoking the riots. The officials, briefing reporters on condition of anonymity, noted that the riots broke out on the day that the first battalion of newly retrained Iraqi soldiers completed their nine-week basic course -- a first step toward establishing a new Iraqi army.

"The fact that the payments to the old conscripts have gone without incident so far and the successful graduation of the first battalion of the new Iraqi army seem to have been a bit too much for the old guard to accept," one official said.

"They started to stir the crowd, they spread rumors the last of the conscripts would not be paid, that the coalition forces did not have enough money. There were clearly groups of former Baathist officers with green banners in the crowd, inciting the others," the official said.

President Bush's administration plans to spend $2 billion to create a 40,000-member Iraqi military by the end of next year. On Saturday, the first batch of 700 recruits completed their basic training at a desert training camp in Kir Kush, 52 miles northeast of Baghdad.