Weather remained dry and pleasant in J&K on Friday as the Meteorological (MeT) department forecast fair weather in J&K and Ladakh during the next seven days.
The victim was identified as Shams-ud-din Pir, according to the police. With this the number of persons killed in Monday's attack has gone up to three.
Fresh snowfall was reported from most parts of Kashmir, including Srinagar, the summer capital of Jammu and Kashmir, the officials said.
Authorities have so far not reported any casualty due to the strong earthquake that shook the Valley causing fear and panic.
The gun battle took place late Friday in Lelhar area. Two AK-47 rifles were recovered from them.
"The grenade missed its target and exploded on the road.
The encounter took place in the Kreeri area after the security forces cordoned off the area and launched a search operation on the basis of specific information about the presence of terrorists.
The area has been cordoned off to nab the terrorists and both the injured were shifted to hospital.
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The attack came on the 12th anniversary of Mumbai terror attacks and ahead of the District Development Council (DDC) elections in the Union territory.
Acting on specific information about the presence of militants in Rangreth near the old airfield here, the security forces launched a cordon and search operation in the area, a police official said.
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The case was registered on October 8 under various sections of the Indian Penal Code (IPC) and Unlawful Activities (Prevention) Act (UAPA).
A top police officer said that two terrorists' bodies are visible and expressed possibility that there could be one more as searches are still underway.
"About 11,000 candidates had initially applied and gone through the physical tests. Out of these, 5,151 male and 438 female shortlisted candidates have appeared for the written test today."