Citing concern of a possible terrorist attack over the holidays, the Bush administration raised the nation's terrorism-threat status to orange, the second-highest level Sunday. Homeland Security Secretary Ridge said intercepted messages suggest foreign extremists anticipate an attack that will "rival or exceed" those of Sept. 11, 2001. Still, while calling for extra vigilance and patience, Ridge urged Americans not to curtail holiday travel or other activities. Above, police check an unattended purse at New York's Grand Central Terminal Sunday.

Many retailers complained of disappointing sales over the final weekend before Christmas, although business was brisk at luxury stores and discounters. Analysts and industry groups were divided on what impact the elevated terror alert may have on last-minute shoppers during what are traditionally the busiest days of the year.

A new opinion survey gives President Bush his highest marks on the economy in more than a year. Fifty-five percent of respondents who identified themselves as registered voters in the Associated Press-Ipsos poll approved of the president's handling of the economy, while 43 percent disapproved. That's a significant change since last month, when Bush had 46 percent approval and 51 percent disapproval on the issue, which political analysts consider key to his reelection campaign.

Hoping to import low-cost medications from Canada for state employees and retirees, Illinois Gov. Rod Blagojevich (D) requested a waiver of federal rules that ban such purchases. The governor wants Health and Human Services Secretary Tommy Thompson to authorize a state pilot program under the new Medicare bill, a Blagojevich spokeswoman said. Officials in New Hampshire, Boston, and Springfield, Mass., also are exploring cross-border purchases, in defiance of the ban.

Closing arguments were expected to begin in the sentencing phase of sniper Lee Malvo's trial Monday, following testimony by his estranged father. Jurors in Chesapeake, Va., convicted the teenager Thursday of killing FBI analyst Linda Franklin during a string of attacks; now they must decide whether to recommend the death penalty. Malvo's lawyers maintain he acted under the influence of John Mohammed. He was found guilty last month by another jury, which authorized capital punishment.

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