New Issue: Morgan Stanley prices $2.3 million Lasers linked to five stocks

By Angela McDaniels

Tacoma, Wash., Jan. 27 - Morgan Stanley priced $2.3 million of 0% Equity Leading Stockmarket Return Securities due Jan. 25, 2013 linked to a basket of common stocks, according to a 424B2 filing with the Securities and Exchange Commission.

The basket includes equal weights of Phillip Morris International Inc., Nike, Inc., Schlumberger Ltd., Dow Chemical Co. and Apple Inc.

If the basket's closing level is above the downside threshold value - 80% of the initial level - on each day during the life of the notes, the payout at maturity will be par of $10.00 plus the greater of the basket return and 6%. Otherwise, the payout will be par plus the basket return, which could be positive or negative.

In each case, the payout will be capped at $12.80 per note.

Morgan Stanley & Co. Inc. is the agent.

Issuer:	Morgan Stanley
Issue:	Equity Leading Stockmarket Return Securities
Underlying stocks:	Phillip Morris International Inc., Nike, Inc., Schlumberger Ltd., Dow Chemical Co. and Apple Inc., equally weighted
Amount:	$2.3 million
Maturity:	Jan. 25, 2013
Coupon:	0%
Price:	Par of $10.00
Payout at maturity:	Par plus greater of basket return and 6% if basket's closing level is more than 80% of initial level throughout life of notes; otherwise, par plus basket return; payout capped at $12.80 per note in each case
Initial share prices:	$57.53 for Phillip Morris, $82.88 for Nike, $83.25 for Schlumberger, $35.28 for Dow Chemical and $341.10 for Apple
Pricing date:	Jan. 25
Settlement date:	Jan. 28
Agent:	Morgan Stanley & Co. Inc.
Fees:	2.25%
Cusip:	61759G216

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