US Airways shares fell 7.9 percent yesterday after the sixth-largest U.S. airline said it won't report a third-quarter profit because operating problems led to more canceled flights than expected. US Airways slid $2.18 3/4, to $25.43 3/4. The Arlington-based carrier didn't issue a specific forecast and wouldn't say whether it would break even or have a loss.

The unrelenting yen pressed ahead with its steady ascent against the dollar and the single European currency in a rally that showed little sign of slowing. The yen at one point reached a 3 1/2-year peak against the dollar at 103.25 yen before edging back in late New York trading. The Japanese currency also hit a high of 106.84 per euro before backing off.

Microsoft is buying Visio Corp., a leading maker of diagramming and technical drawing software, in a $1.3 billion stock deal that helps Microsoft fill a gap in its line of business products. The purchase will help Microsoft strengthen its grip on the market for business productivity software, already dominated by its Office suite of word-processing, spreadsheet and presentation products.

Local telephone companies won't be forced to lease to their rivals equipment for high-speed Internet services, but they will still have to provide them access to parts of their local networks, the FCC decided. Long-distance companies and other competitors had sought access to the local phone companies' equipment, arguing they needed it to roll out high-speed Internet and data services more quickly.

Xerox suffered a legal setback when a federal court dismissed its lawsuit against Hewlett-Packard, effectively ending one of five technology-related lawsuits between the two office-equipment companies. Xerox said it would appeal the decision.

AT&T, its stock down 30 percent from a record high in February, said it has frozen hiring and intends to eliminate jobs under a plan to cut $2 billion in costs by 2001. The company, which began the hiring freeze Aug. 19, has not determined how many jobs will be cut, a spokeswoman said.

LOCAL BUSINESS America Online announced a marketing deal with health-care Web site CareInsite of Elmwood Park, N.J., in which CareInsite will pay AOL $30 million over an unspecified number of years to be featured on AOL services.

Rockville-based Manugistics Group reported a loss of $3.4 million in the quarter ended Aug. 31 on revenue of $33.8 million, compared with a loss of $6 million on revenue of $53 million in the same period of 1998. Manugistics provides supply chain advice to consumer product companies.

Dunn Computer of Dulles reported a third-quarter loss of $22.9 million, compared with a loss of $969,303 for the same period a year ago. The company cited a goodwill write-off of about $21 million stemming from the 1998 acquisition of International Data Products.