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Energy companies curtailed operations on the Gulf Coast as Tropical Storm Dolly heads towards Texas. But the first major storm to make landfall this season will do so far from oil and gas operations in the region. That trajectory eased supply concerns which dragged oil prices lower for the fourth time in five sessions. Crude close below $128 a barrel after touching a six-month low. Treasury Secretary Henry Paulson was shoring-up support for his rescue proposal for Fannie Mae and Freddie Mac, saying the two companies are vital to the restoration of the housing market, the financial markets, and the economy. His comments came amid mounting mortgage losses. Wachovia posted a near $9 billion quarterly loss and said it would cut 10,700 jobs. And Washington Mutual announced a bigger than expected loss of $3.3 billion. United Airlines is also downsizing its workforce. Parent company UAL said it will now cut 7,000 jobs after announcing a quarterly loss. Fellow air carriers like US Airways and JetBlue also revealed quarterly losses thanks to high energy costs. Despite the gloomy reports - those stocks finished with robust gains thanks to the drop in oil prices. In other earnings highlights, Yahoo posted mildly disappointing results after the close. On Wall Street.... A strong dollar, falling oil, and hopes the banking sector has turned the corner sparked a powerful rally for stocks. The Dow, The S&P 500 and The Nasdaq all rallied at least one percent. Meantime, Vodafone spooked European investors. Mobile phones are not selling as fast as they used to - prompting Vodafone to slash its revenue targets. The market reaction was mixed with the London FTSE hurt by that warning. Conway Gittens, Reuters COMPANIES MENTIONED: Wachovia, Washington Mutual, UAL, US Air, JetBlue, Yahoo, Vodafone SYMBOLS: WB, WM, UAUA, LCC, JBLU, YHOO, VOD