New Issue: Morgan Stanley prices $7.44 million absolute return barrier notes linked to S&P 500

By Jennifer Chiou

New York, April 24 - Morgan Stanley priced $7.44 million of zero-coupon protected absolute return barrier notes due April 20, 2011 linked to the S&P 500 index, according to an FWP filing with the Securities and Exchange Commission.

If the index remains within the index range throughout the life of the notes, the payout at maturity will be par of $10 plus the absolute value of the index return. Otherwise, the payout will be par.

The lower barrier of the index range is 70% of the initial level, and the upper barrier is 150% of the initial level.

If the final index level is greater than the initial level, the payout will be capped at 50%. If the final level is less than the initial level, the payout will be capped at 30%.

Morgan Stanley & Co. Inc. is the agent.

Issuer:	Morgan Stanley
Issue:	Protected absolute return barrier notes
Underlying index:	S&P 500
Amount:	$7,440,960
Maturity:	April 20, 2011
Coupon:	0%
Price:	Par of $10
Payout at maturity:	If index remains within index range throughout life of notes, par plus absolute value of index return, cap of 50% payout for final index gain and cap of 30% if final index level declines from initial level; otherwise, par
Initial index level:	851.92
Index range:	596.344 to 1,277.88, inclusive; 70% of initial level to 150% of initial level, inclusive
Pricing date:	April 23
Settlement date:	April 30
Agent:	Morgan Stanley & Co. Inc.
Fees:	1.75%

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