S&P futures vs fair value: -7.5. Nasdaq futures vs fair value: -13.0.

The stage remains set for stocks to open sharply lower as renewed subprime concerns and a weaker than expected batch of earnings reports gives investors several reasons to consolidate gains that lifted the Dow to four straight record closes and above the 14,000 milestone yesterday. Unfortunately for the bulls, today’s inflation data (e.g. CPI) was inconclusive and there is still little chance of even a decent rebound in housing starts over the coming months. On a positive note, Macy's (M) is soaring 15% in pre-market action amid reports that KKR is mulling a $24 bln bid, lending further evidence that liquidity remains prevalent.