MERRILL LYNCH
GLOBAL VALUE
FUND, INC.
FUND LOGO
Semi-Annual Report
June 30, 1998
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
Merrill Lynch
Global Value Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
MERRILL LYNCH GLOBAL VALUE FUND, INC.
Worldwide
Investments
As of 6/30/98
Percent of
Ten Largest Industries Net Assets
Utilities--Electric & Gas 16.6%
Financial Services 11.0
Insurance 9.7
Beverages & Tobacco 9.3
Food & Household Products 8.8
Telecommunications 8.1
Energy Equipment & Services 4.5
Health & Personal Care 4.3
Electronic Components/Instruments 3.8
Transportation--Airlines 3.3
Country of Percent of
Ten Largest Equity Holdings Origin Net Assets
General Re Corporation United States 6.0%
Cadbury Schweppes PLC United Kingdom 5.9
Nestle S.A. (Registered) Switzerland 5.0
ING Groep N.V. Netherlands 4.5
Schlumberger Ltd. United States 4.5
Federal National Mortgage
Association United States 4.2
WorldCom Inc. United States 4.0
National Power PLC United Kingdom 3.4
Diageo PLC United Kingdom 3.4
Lufthansa AG Germany 3.3
Merrill Lynch Global Value Fund, Inc., June 30, 1998
DEAR SHAREHOLDER
Merrill Lynch Global Value Fund, Inc.'s Class A, Class B, Class C
and Class D Shares had total returns of +0.82%, +0.55%, +0.55% and
+0.79%, respectively, for the quarter ended June 30, 1998,
underperforming the +2.03% return for the unmanaged Morgan Stanley
Capital International (MSCI) World Index. For the first half of
1998, the Fund outperformed the MSCI World Index, with Class A,
Class B, Class C and Class D Shares providing total returns of
+19.71%, +19.03%, +19.03% and +19.52%, respectively, compared to a
+16.64% return for the Index. (Fund results do not reflect sales
charges, and would be lower if sales charges were included. Complete
performance information can be found on pages 4 and 5 of this report
to shareholders.)
Another Look at
Concentration
Shares of Lattice Semiconductor Corporation, one of our larger
positions, declined 44.78% in the June quarter, which resulted in
the Fund slightly underperforming relative to the Index. As much as
it may appear to be desirable to outperform a passive index each and
every quarter, this is not a goal that we strive for. Outperforming
(or underperforming) a passive benchmark for a quarter or a year is
not necessarily representative of superior (or inferior) investment
ability. The longer the period measured, the more likely that
investment results are indicative of investment ability (or lack of
investment ability). However, virtually all successful long-term
investors would agree that short-term performance provides no
meaningful information.
Stock price free-falls--such as occurred with Lattice Semiconductor
- --are likely to happen from time to time, just as stock prices can
abruptly rise, sometimes for no apparent reasons. When a stock falls
sharply, we must reassess our position. Were we wrong in our premise
for owning the stock? Or, has an unforeseen near-term development
led to the price decline, but the company is likely to overcome its
difficulties over the longer term? Or, do we still believe that our
initial valuation of the company's businesses is correct, and that
the sudden price decline is a true aberration? In the latter two
cases, we would view a substantial stock price decline as a great
opportunity to invest more in a company whose shares are selling for
a fraction of what they are worth.
In the case of Lattice Semiconductor, we already owned a large
enough position in the company to preclude further investment. More
important, although we believed that the stock was a reasonable
value to begin with, and believe it is a very good value after its
decline, we are more cognizant that there are significant risks
associated with technology stocks. Like many semiconductor
companies, Lattice Semiconductor had lower revenues and profits in
the second calendar quarter, but its profit margins remained high.
The company was affected more than its peers, however, as it
suffered from a higher dependence on Asian sales, end-customer
demand weakness and delays in its current products cycle. Since much
of the trading in Lattice Semiconductor shares appears to have been
short-term oriented, the stock was negatively impacted much beyond
the actual decline in quarterly profits. We have seen the impact
that certain investor constituencies can have on companies like
Lattice Semiconductor when they encounter only the mildest of
business disappointments.
Despite the short-term downside potential of a relatively
concentrated portfolio, we still maintain that it is our best
strategy over the long term. Our large positions generally have very
low correlations with each other, so they are not likely to
experience the same difficulties at the same time. Furthermore, if
we had small positions, our best investment ideas would have only a
moderate impact on performance. Unlike a growth fund, in which the
best-performing stocks may appreciate by 100%--200% per year, our
best performers are unlikely to provide spectacular returns, even
though we hope that they will outperform their respective markets.
If we go back to November 1996, Merrill Lynch Global Value Fund's
inception, there are some growth stocks that have had extraordinary
performances. For example, Dell Computer Corp., Microsoft Corp. and
Cisco Systems, Inc. appreciated approximately 800%, 200% and 150%,
respectively, from November 1996 through June 1998. In Europe, SAP
AG has risen 460%. However, these are not the types of stocks that
we are likely to buy. We focus on buying shares of good (but not
great) companies. (We would like to buy shares of great companies at
low valuations, but this opportunity almost never occurs.) Once our
type of stocks become valued as if they are very good companies, we
want to carefully consider whether or not we should sell our
investment. Therefore, when we have an investment idea that we
believe will give us the very good performance that we seek over a
two-year--five-year time period, we must buy enough so that it has
a meaningful impact on portfolio performance. Our conclusion is that
although concentration may hurt on a near-term basis, we believe
that it will be an effective long-term strategy for us to seek
superior investment returns.
Seeking New Investments
In Europe
As of the end of June, the Fund was approximately neutrally weighted
relative to the MSCI World Index in the United States, overweighted
in the United Kingdom and slightly underweighted in Continental
Europe. We believed that there are some compelling reasons why
Continental European stocks should outperform over the course of the
next several years, and we continued to seek greater exposure there.
However, from a bottom-up perspective, we have identified more
attractive values in the United States in recent months. As a
result, our modest underweighting in Europe is not indicative of our
investment outlook. We anticipate that if our outlook for Europe
continues, we will further our search for attractive long-term
investment opportunities in Europe over the course of 1998.
In Conclusion
Once again, we believe it is important to remind shareholders that a
20% per year return on stocks is much higher than the historic
trend, which is closer to 10% per year. Of course we are not
complaining about buoyant stock market returns, but we want to
reemphasize our view that we should not count on this level of
returns indefinitely. An ancillary point is that we expected that
our investment style would lead us to modestly underperform during
strong stock markets and outperform during bear markets. While we
are pleased to be outperforming the stock market year to date, we
will be more pleased if the Fund outperforms during those inevitable
periods of poor stock price performance.
We thank you for your investment in Merrill Lynch Global Value Fund,
Inc., and we look forward to reviewing our outlook and strategy with
you again in our next report to shareholders.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Stephen I. Silverman)
Stephen I. Silverman
Senior Vice President and
Portfolio Manager
August 10, 1998
Merrill Lynch Global Value Fund, Inc., June 30, 1998
PERFORMANCE DATA
About Fund
Performance
Investors are able to purchase shares of the Fund through the
Merrill Lynch Select Pricing SM System, which offers four pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end load)
of 5.25% and bear no ongoing distribution or account maintenance
fees. Class A Shares are available only to eligible investors.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.75% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after approximately 8 years. (There is no initial
sales charge for automatic share conversions.)
* Class C Shares are subject to a distribution fee of 0.75% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 5.25% and an
account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation
of future performance. Figures shown in the "Recent Performance
Results" and "Average Annual Total Return" tables assume
reinvestment of all dividends and capital gains distributions at net
asset value on the ex-dividend date. Investment return and principal
value of shares will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost. Dividends paid to each
class of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
<TABLE>
Recent
Performance
Results*
<CAPTION>
12 Month 3 Month Since Inception
Total Return Total Return Total Return
<S> <C> <C> <C>
ML Global Value Fund, Inc. Class A Shares +30.09% +0.82% +51.15%
ML Global Value Fund, Inc. Class B Shares +28.75 +0.55 +48.59
ML Global Value Fund, Inc. Class C Shares +28.76 +0.55 +48.60
ML Global Value Fund, Inc. Class D Shares +29.68 +0.79 +50.49
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included. Total
investment returns are based on changes in net asset values for the
periods shown, and assume reinvestment of all dividends and capital
gains distributions at net asset value on the ex-dividend date. The
Fund commenced operations on 11/01/96.
</TABLE>
Average Annual
Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 6/30/98 +30.09% +23.26%
Inception (11/01/96) through 6/30/98 +28.25 +24.15
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 6/30/98 +28.75% +24.75%
Inception (11/01/96) through 6/30/98 +26.94 +25.39
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
% Return % Return
Without CDSC With CDSC**
Class C Shares*
Year Ended 6/30/98 +28.76% +27.76%
Inception (11/01/96) through 6/30/98 +26.94 +26.94
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Year Ended 6/30/98 +29.68% +22.87%
Inception (11/01/96) through 6/30/98 +27.91 +23.82
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
OFFICERS AND DIRECTORS
Arthur Zeikel, President and Director
Donald Cecil, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
Richard R. West, Director
Edward D. Zinbarg, Director
Terry K. Glenn, Executive Vice President
Norman R. Harvey, Executive Vice President
Stephen I. Silverman, Senior President
and Portfolio Manager
Donald C. Burke, Vice President
Gerald M. Richard, Treasurer
Barbara G. Fraser, Secretary
Custodian
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
Merrill Lynch Global Value Fund, Inc., June 30, 1998
<TABLE>
SCHEDULE OF INVESTMENTS (in US dollars)
<CAPTION>
NORTH Shares Value Percent of
AMERICA Industries Held Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Canada Transportation-- 1,504,700 Canadian National Railway Company $ 73,574,929 $ 79,937,187 3.0%
Road & Rail
Total Investments in Canada 73,574,929 79,937,187 3.0
United Electronic 2,070,700 ++Lattice Semiconductor Corporation+++ 104,996,064 58,626,694 2.2
States Components/
Instruments
Energy 1,716,000 Schlumberger Ltd. 130,814,706 117,224,250 4.5
Equipment &
Services
Financial 1,827,400 Federal National Mortgage
Services Association 79,099,130 111,014,550 4.2
510,000 Morgan (J.P.) & Co., Inc. 56,314,142 59,733,750 2.3
-------------- -------------- ------
135,413,272 170,748,300 6.5
Health & 1,144,000 Baxter International, Inc. 61,537,393 61,561,500 2.4
Personal Care
Insurance 617,300 General Re Corporation 133,157,732 156,485,550 6.0
1,380,000 Horace Mann Educators Corp. 25,535,781 47,610,000 1.8
-------------- -------------- ------
158,693,513 204,095,550 7.8
Merchandising 2,414,000 American Stores Company 60,081,759 58,388,625 2.2
Telecommunications 775,200 ++ADC Telecommunications, Inc. 20,548,965 28,294,800 1.1
2,450,000 Frontier Corporation 78,632,772 77,175,000 3.0
2,186,000 ++WorldCom Inc. 77,895,778 105,611,125 4.0
-------------- -------------- ------
177,077,515 211,080,925 8.1
Utilities-- 1,225,950 Columbia Energy Group 63,217,999 68,193,469 2.6
Electric & Gas 2,202,100 Houston Industries Inc. 49,617,722 67,989,837 2.6
1,397,000 K N Energy, Inc.+++ 78,302,281 75,699,937 2.9
1,830,000 Unicom Corporation 57,049,442 64,164,375 2.5
-------------- -------------- ------
248,187,444 276,047,618 10.6
Total Investments in the
United States 1,076,801,666 1,157,773,462 44.3
Total Investments in North
America 1,150,376,595 1,237,710,649 47.3
PACIFIC
BASIN
Australia Leisure & 360,000 Village Roadshow Limited
Tourism (Convertible Preferred) 18,000,000 15,210,000 0.6
11,800,652 Village Roadshow Limited
(Preferred)(Class A) 30,727,549 17,545,209 0.7
-------------- -------------- ------
48,727,549 32,755,209 1.3
Real Estate 1,702,858 Lend Lease Corporation Ltd. 31,963,575 34,443,155 1.3
Total Investments in Australia 80,691,124 67,198,364 2.6
Japan Appliances & 1,690,000 Matsushita Electric Industrial
Household Co., Ltd. 28,894,269 27,197,084 1.0
Durables 400,000 Sony Corporation 36,894,499 34,495,201 1.3
-------------- -------------- ------
65,788,768 61,692,285 2.3
Construction 1,041,400 Chudenko Corporation 25,425,850 21,756,895 0.8
& Housing 788,000 Kinden Corporation 9,663,415 9,553,583 0.4
-------------- -------------- ------
35,089,265 31,310,478 1.2
Data 2,166,000 Canon Inc. 51,626,097 49,237,930 1.9
Processing &
Reproduction
Electronic 1,276,000 Murata Manufacturing Company, Ltd. 39,076,429 41,437,541 1.6
Components/
Instruments
Insurance 3,376,000 Dai-Tokyo Fire & Marine
Insurance Co., Ltd. 13,600,046 11,767,396 0.5
784,000 Nichido Fire & Marine Insurance
Co., Ltd. 4,117,378 4,101,898 0.2
4,411,000 Sumitomo Marine & Fire Insurance
Co., Ltd. 30,544,736 24,701,855 0.9
850,000 Tokio Marine & Fire Insurance
Co., Ltd. 10,618,405 8,747,204 0.3
-------------- -------------- ------
58,880,565 49,318,353 1.9
Miscellaneous 10,000 Toyo Seikan Kaisha, Ltd. 106,000 122,682 0.0
--Materials
& Commodities
Total Investments in Japan 250,567,124 233,119,269 8.9
Total Investments in the
Pacific Basin 331,258,248 300,317,633 11.5
WESTERN
EUROPE
France Food & 302,000 Groupe Danone S.A. 43,350,953 83,301,729 3.2
Household 275,000 Groupe Danone S.A. (ADR)* 8,525,000 15,125,000 0.6
Products
Total Investments in France 51,875,953 98,426,729 3.8
Germany Transportation 3,397,200 Lufthansa AG 58,750,712 85,532,207 3.3
--Airlines
Utilities-- 1,599,650 Berliner Kraft-und Licht (Bewag) AG 70,505,238 68,232,357 2.6
Electric & Gas
Total Investments in Germany 129,255,950 153,764,564 5.9
Ireland Banking 3,800,000 Allied Irish Banks PLC 29,461,508 54,938,699 2.1
9,500 Allied Irish Banks PLC (ADR)* 482,133 815,219 0.0
Total Investments in Ireland 29,943,641 55,753,918 2.1
Netherlands Financial 1,796,500 ING Groep N.V. 76,829,176 117,878,719 4.5
Services
Total Investments in the
Netherlands 76,829,176 117,878,719 4.5
Switzerland Food & Household 60,800 Nestle S.A. (Registered) 67,899,128 130,199,762 5.0
Products
Health & 30,000 Novartis AG (Registered) 35,109,090 49,953,820 1.9
Personal Care
Total Investments in
Switzerland 103,008,218 180,153,582 6.9
United Beverages & 10,100,000 Cadbury Schweppes PLC 91,146,039 156,300,909 5.9
Kingdom Tobacco 7,470,078 Diageo PLC 67,457,499 88,493,159 3.4
-------------- -------------- ------
158,603,538 244,794,068 9.3
Utilities-- 9,449,573 National Power PLC 89,490,280 88,923,695 3.4
Electric & Gas
Total Investments in the
United Kingdom 248,093,818 333,717,763 12.7
Total Investments in Western Europe 639,006,756 939,695,275 35.9
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1998
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in US dollars)
<CAPTION>
SHORT-TERM Face Value Percent of
SECURITIES Amount Issue Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
Commercial $99,376,000 General Motors Acceptance Corp.,
Paper** 6.50% due 7/01/1998 $ 99,376,000 $ 99,376,000 3.8%
Total Investments in Short-Term
Securities 99,376,000 99,376,000 3.8
<CAPTION>
OPTIONS Nominal Value Premiums
PURCHASED Covered by Options Paid
<S> <C> <S> <C> <C> <C>
Currency Put 260,000,000 Japanese Yen, expiring December
Options 1998 at YEN 130 7,683,000 17,238,000 0.7
Purchased
Total Options Purchased 7,683,000 17,238,000 0.7
Total Investments $2,227,700,599 2,594,337,557 99.2
==============
Unrealized Appreciation on Forward Foreign Exchange Contracts++++ 12,405,456 0.5
Other Assets Less Liabilities 8,685,668 0.3
-------------- ------
Net Assets $2,615,428,681 100.0%
============== ======
<FN>
*American Depositary Receipts (ADR).
**Commercial Paper is traded on a discount basis; the interest rate
shown is the discount rate paid at the time of purchase by the Fund.
+++Investment in companies 5% or more of whose outstanding
securities are held by the Fund (such companies are defined as
"Affiliated Companies" in section 2(a)(3) of the Investment Company
Act of 1940) are as follows:
<CAPTION>
Net Share Net Dividend
Industry Affiliate Activity Cost Income
<S> <S> <C> <C> <C>
Electronic Lattice 409,500 $18,485,090 ++
Components/ Semiconductor
Instruments Corporation
Utilities-- K N Energy, Inc. 1,397,000 78,302,281 $366,800
Electric & Gas
++Non-income producing security.
++Non-income producing security.
++++Forward foreign exchange contracts as of June 30, 1998 were as
follows:
<CAPTION>
Unrealized
Foreign Appreciation
Currency Expiration (Depreciation)
Purchased Date (Note 1d)
<S> <C> <S> <C>
Frf 337,119,697 December 1998 $ (844,514)
Pound 933,760 December 1998 9,552
Sterling
Lit 97,882,627,500 October 1998 310,565
Nlg 137,452,680 December 1998 (987,083)
YEN 5,282,983,031 December 1998 765,429
Total (US$ Commitment--$221,181,953) (746,051)
-----------
<CAPTION>
Foreign
Currency Sold
<S> <C> <S> <C>
Chf 16,625,000 August 1998 752,084
Chf 99,330,352 December 1998 2,859,026
Frf 337,119,697 December 1998 (214,243)
Pound 119,925,515 December 1998 (2,985,115)
Sterling
Lit 97,882,627,500 October 1998 1,516,525
Nlg 234,470,221 December 1998 999,828
YEN 16,307,848,382 December 1998 10,223,402
Total (US$ Commitment--$637,653,977) 13,151,507
-----------
Total Unrealized Appreciation on
Forward Foreign Exchange Contracts--Net $12,405,456
===========
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of June 30, 1998
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$2,220,017,599)(Note 1a) $2,577,099,557
Put options purchased, at value (cost--$7,683,000)
(Notes 1a & 1d) 17,238,000
Unrealized appreciation on forward foreign exchange
contracts (Note 1d) 12,405,456
Cash 873,826
Foreign cash (Note 1c) 2,457,148
Receivables:
Capital shares sold $ 10,260,150
Dividends 6,509,255
Forward foreign exchange contracts (Note 1d) 642,103 17,411,508
--------------
Deferred organization expenses (Note 1g) 150,678
Prepaid registration fees and other assets (Note 1g) 94,798
--------------
Total assets 2,627,730,971
--------------
Liabilities: Payables:
Capital shares redeemed 3,921,323
Securities purchased 2,501,057
Distributor (Note 2) 1,869,260
Investment adviser (Note 2) 1,676,126
Forward foreign exchange contracts (Note 1d) 1,657,948 11,625,714
--------------
Accrued expenses 676,576
--------------
Total liabilities 12,302,290
--------------
Net Assets: Net assets $2,615,428,681
==============
Net Assets Class A Shares of Common Stock, $0.10 par value, 100,000,000
Consist of: shares authorized $ 1,146,046
Class B Shares of Common Stock, $0.10 par value, 300,000,000
shares authorized 12,771,054
Class C Shares of Common Stock, $0.10 par value, 100,000,000
shares authorized 2,393,779
Class D Shares of Common Stock, $0.10 par value, 100,000,000
shares authorized 2,670,477
Paid-in capital in excess of par 2,086,245,622
Accumulated investment loss--net (8,562,702)
Undistributed realized capital gains on investments and foreign
currency transactions--net 139,697,218
Unrealized appreciation on investments and foreign currency
transactions--net 379,067,187
--------------
Net assets $2,615,428,681
==============
Net Asset Class A--Based on net assets of $158,944,537 and 11,460,456
Value: shares outstanding $ 13.87
==============
Class B--Based on net assets of $1,757,439,352 and 127,710,544
shares outstanding $ 13.76
==============
Class C--Based on net assets of $329,372,142 and 23,937,787
shares outstanding $ 13.76
==============
Class D--Based on net assets of $369,672,650 and 26,704,769
shares outstanding $ 13.84
==============
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1998
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Six Months Ended June 30, 1998
<S> <S> <C> <C>
Investment Dividends (net of $1,667,297 foreign withholding tax) $ 31,291,220
Income Interest and discount earned 4,242,738
(Notes 1e & 1f): ------------
Total income 35,533,958
------------
Expenses: Investment advisory fees (Note 2) $ 8,344,791
Account maintenance and distribution fees--Class B (Note 2) 7,585,763
Account maintenance and distribution fees--Class C (Note 2) 1,403,051
Transfer agent fees--Class B (Note 2) 666,277
Account maintenance fees--Class D (Note 2) 395,072
Custodian fees 390,664
Transfer agent fees--Class C (Note 2) 127,058
Transfer agent fees--Class D (Note 2) 110,968
Printing and shareholder reports 92,696
Registration fees (Note 1g) 67,650
Professional fees 51,805
Accounting services (Note 2) 49,546
Amortization of organization expenses--net (Note 1g) 43,228
Transfer agent fees--Class A (Note 2) 38,631
Directors' fees and expenses 16,161
Pricing fees 2,383
Other 14,003
------------
Total expenses 19,399,747
------------
Investment income--net 16,134,211
------------
Realized & Realized gain from:
Unrealized Gain Investments--net 111,740,664
(Loss) on Foreign currency transactions--net 27,956,693 139,697,357
Investments & ------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net 206,118,071
(Notes 1c, 1d, Foreign currency transactions--net (4,091,727) 202,026,344
1f & 3): ------------ ------------
Net realized and unrealized gain on investments and foreign
currency transactions 341,723,701
------------
Net Increase in Net Assets Resulting from Operations $357,857,912
============
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the Period For the
Months Ended Nov. 1, 1997 to Year Ended
Increase (Decrease) in Net Assets: June 30, 1998 Dec. 31, 1997 Oct. 31, 1997++
<S> <S> <C> <C> <C>
Operations: Investment income (loss)--net $ 16,134,211 $ (1,004,882) $ 12,822,166
Realized gain on investments and foreign currency
transactions--net 139,697,357 57,796,106 64,521,637
Change in unrealized appreciation/depreciation
on investments and foreign currency
transactions--net 202,026,344 46,078,685 130,962,158
-------------- -------------- --------------
Net increase in net assets resulting from
operations 357,857,912 102,869,909 208,305,961
-------------- -------------- --------------
Dividends & Investment income--net:
Distributions to Class A (1,590,747) (549,581) (72,233)
Shareholders Class B (17,628,386) (2,957,634) (2,571,571)
(Note 1h): Class C (3,279,389) (551,700) (463,638)
Class D (3,998,615) (1,860,239) (721,214)
Realized gain on investments--net:
Class A (3,244,505) (2,139,606) --
Class B (40,188,532) (44,190,132) --
Class C (7,468,874) (8,093,819) --
Class D (8,365,589) (8,896,075) --
-------------- -------------- --------------
Net decrease in net assets resulting from
dividends and distributions to shareholders (85,764,637) (69,238,786) (3,828,656)
-------------- -------------- --------------
Capital Share Net increase in net assets derived from capital
Transactions share transactions 539,834,986 81,836,169 1,483,455,823
(Note 4): -------------- -------------- --------------
Net Assets: Total increase in net assets 811,928,261 115,467,292 1,687,933,128
Beginning of period 1,803,500,420 1,688,033,128 100,000
-------------- -------------- --------------
End of period* $2,615,428,681 $1,803,500,420 $1,688,033,128
============== ============== ==============
<FN>
*Undistributed (accumulated) investment
income (loss)--net $ (8,562,702) $ 1,800,224 $ 10,195,652
============== ============== ==============
++The Fund commenced operations on November 1, 1996.
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1998
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios
have been derived from information provided Class A++++
in the financial statements. For the Six For the Period For the
Months Ended Nov. 1, 1997 to Year Ended
Increase (Decrease) in Net Asset Value: June 30, 1998 Dec. 31, 1997 Oct. 31, 1997++
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 12.01 $ 11.83 $ 10.00
Operating -------------- -------------- --------------
Performance: Investment income--net .15 .01 .17
Realized and unrealized gain on investments
and foreign currency transactions--net 2.22 .72 1.71
-------------- -------------- --------------
Total from investment operations 2.37 .73 1.88
-------------- -------------- --------------
Less dividends and distributions:
Investment income--net (.17) (.11) (.05)
Realized gain on investments--net (.34) (.44) --
-------------- -------------- --------------
Total dividends and distributions (.51) (.55) (.05)
-------------- -------------- --------------
Net asset value, end of period $ 13.87 $ 12.01 $ 11.83
============== ============== ==============
Total Investment Based on net asset value per share 19.71%+++ 6.19%+++ 18.91%
Return:** ============== ============== ==============
Ratios to Average Expenses .88%* .96%* .97%
Net Assets: ============== ============== ==============
Investment income--net 2.24%* .54%* 1.88%
============== ============== ==============
Supplemental Net assets, end of period (in thousands) $ 158,945 $ 63,075 $ 53,776
Data: ============== ============== ==============
Portfolio turnover 25.48% 24.49% 77.65%
============== ============== ==============
<CAPTION>
The following per share data and ratios have
been derived from information provided in Class B++++
the financial statements. For the Six For the Period For the
Months Ended Nov. 1, 1997 to Year Ended
Increase (Decrease) in Net Asset Value: June 30, 1998 Dec. 31, 1997 Oct. 31, 1997++
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 11.97 $ 11.72 $ 10.00
Operating -------------- -------------- --------------
Performance: Investment income (loss)--net .09 (.01) .09
Realized and unrealized gain on investments and
foreign currency transactions--net 2.19 .73 1.67
-------------- -------------- --------------
Total from investment operations 2.28 .72 1.76
-------------- -------------- --------------
Less dividends and distributions:
Investment income--net (.15) (.03) (.04)
Realized gain on investments--net (.34) (.44) --
-------------- -------------- --------------
Total dividends and distributions (.49) (.47) (.04)
-------------- -------------- --------------
Net asset value, end of period $ 13.76 $ 11.97 $ 11.72
============== ============== ==============
Total Investment Based on net asset value per share 19.03%+++ 6.14%+++ 17.62%
Return:** ============== ============== ==============
Ratios to Average Expenses 1.90%* 1.98%* 1.99%
Net Assets: ============== ============== ==============
Investment income (loss)--net 1.30%* (.49%)* .84%
============== ============== ==============
Supplemental Net assets, end of period (in thousands) $ 1,757,439 $ 1,251,956 $ 1,179,125
Data: ============== ============== ==============
Portfolio turnover 25.48% 24.49% 77.65%
============== ============== ==============
<CAPTION>
The following per share data and ratios have
been derived from information provided in Class C++++
the financial statements. For the Six For the Period For the
Months Ended Nov. 1, 1997 to Year Ended
Increase (Decrease) in Net Asset Value: June 30, 1998 Dec. 31, 1997 Oct. 31, 1997++
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 11.97 $ 11.72 $ 10.00
Operating -------------- -------------- --------------
Performance: Investment income (loss)--net .09 (.01) .09
Realized and unrealized gain on investments and
foreign currency transactions--net 2.19 .73 1.67
-------------- -------------- --------------
Total from investment operations 2.28 .72 1.76
-------------- -------------- --------------
Less dividends and distributions:
Investment income--net (.15) (.03) (.04)
Realized gain on investments--net (.34) (.44) --
-------------- -------------- --------------
Total dividends and distributions (.49) (.47) (.04)
-------------- -------------- --------------
Net asset value, end of period $ 13.76 $ 11.97 $ 11.72
============== ============== ==============
Total Investment Based on net asset value per share 19.03%+++ 6.14%+++ 17.62%
Return:** ============== ============== ==============
Ratios to Average Expenses 1.91%* 1.98%* 1.99%
Net Assets: ============== ============== ==============
Investment income (loss)--net 1.29%* (.49%)* .83%
============== ============== ==============
Supplemental Net assets, end of period (in thousands) $ 329,372 $ 229,601 $ 217,341
Data: ============== ============== ==============
Portfolio turnover 25.48% 24.49% 77.65%
============== ============== ==============
<FN>
++The Fund commenced operations on November 1, 1996.
++++Based on average shares outstanding.
+++Aggregate total investment return.
*Annualized.
**Total investment returns exclude the effects of sales loads.
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1998
<TABLE>
FINANCIAL HIGHLIGHTS (concluded)
<CAPTION>
The following per share data and ratios
have been derived from information provided Class D++++
in the financial statements. For the Six For the Period For the
Months Ended Nov. 1, 1997 to Year Ended
Increase (Decrease) in Net Asset Value: June 30, 1998 Dec. 31, 1997 Oct. 31, 1997++
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 12.00 $ 11.80 $ 10.00
Operating -------------- -------------- --------------
Performance: Investment income--net .14 .01 .18
Realized and unrealized gain on investments and
foreign currency transactions--net 2.20 .72 1.67
-------------- -------------- --------------
Total from investment operations 2.34 .73 1.85
-------------- -------------- --------------
Less dividends and distributions:
Investment income--net (.16) (.09) (.05)
Realized gain on investments--net (.34) (.44) --
-------------- -------------- --------------
Total dividends and distributions (.50) (.53) (.05)
-------------- -------------- --------------
Net asset value, end of period $ 13.84 $ 12.00 $ 11.80
============== ============== ==============
Total Investment Based on net asset value per share 19.52%+++ 6.20%+++ 18.56%
Return:** ============== ============== ==============
Ratios to Average Expenses 1.14%* 1.21%* 1.22%
Net Assets: ============== ============== ==============
Investment income--net 2.06%* .28%* 1.62%
============== ============== ==============
Supplemental Net assets, end of period (in thousands) $ 369,673 $ 258,868 $ 237,791
Data: ============== ============== ==============
Portfolio turnover 25.48% 24.49% 77.65%
============== ============== ==============
<FN>
++The Fund commenced operations on November 1, 1996.
++++Based on average shares outstanding.
+++Aggregate total investment return.
*Annualized.
**Total investment returns exclude the effects of sales loads.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Global Value Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified, open-
end management investment company. These unaudited financial
statements reflect all adjustments which are, in the opinion of
management, necessary to a fair statement of the results for the
interim period presented. All such adjustments are of a normal
recurring nature. The Fund offers four classes of shares under the
Merrill Lynch Select Pricing SM System. Shares of Class A and Class D
are sold with a front-end sales charge. Shares of Class B and Class
C may be subject to a contingent deferred sales charge. All classes
of shares have identical voting, dividend, liquidation and other
rights and the same terms and conditions, except that Class B, Class
C and Class D Shares bear certain expenses related to the account
maintenance of such shares, and Class B and Class C Shares also bear
certain expenses related to the distribution of such shares. Each
class has exclusive voting rights with respect to matters relating
to its account maintenance and distribution expenditures. The
following is a summary of significant accounting policies followed
by the Fund.
(a) Valuation of securities--Portfolio securities which are traded
on stock exchanges are valued at the last sale price on the exchange
on which such securities are traded, as of the close of business on
the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange
designated by or under the authority of the Board of Directors as
the primary market. Securities which are traded both in the over-the-
counter market and on a stock exchange are valued according to the
broadest and most representative market. Options written are valued
at the last sale price in the case of exchange-traded options or, in
the case of options traded in the over-the-counter market, the last
asked price. Options purchased are valued at the last sale price in
the case of exchange-traded options or, in the case of options
traded in the over-the-counter market, the last bid price. Short-
term securities are valued at amortized cost, which approximates
market value. Other investments, including financial futures
contracts and related options, are stated at market value.
Securities and assets for which market quotations are not readily
available are valued at their fair value as determined in good faith
by or under the direction of the Fund's Board of Directors.
(b) Repurchase agreements--The Fund invests in US Government
securities pursuant to repurchase agreements. Under such agreements,
the counterparty agrees to repurchase the security at a mutually
agreed upon time and price. The Fund takes possession of the
underlying securities, marks to market such securities and, if
necessary, receives additions to such securities daily to ensure
that the contract is fully collateralized.
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(d) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the equity and currency
markets. Losses may arise due to changes in the value of the
contract or if the counterparty does not perform under the contract.
* Options--The Fund is authorized to write and purchase call and put
options. When the Fund writes an option, an amount equal to the
premium received by the Fund is reflected as an asset and an
equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current market value of the option
written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
Merrill Lynch Global Value Fund, Inc., June 30, 1998
NOTES TO FINANCIAL STATEMENTS (continued)
Written and purchased options are non-income producing investments.
* Forward foreign exchange contracts--The Fund is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Fund's records. However, the effect on
operations is recorded from the date the Fund enters into such
contracts. Premium or discount is amortized over the life of the
contracts.
* Foreign currency options and futures--The Fund may also purchase
or sell listed or over-the-counter foreign currency options, foreign
currency futures and related options on foreign currency futures as
a short or long hedge against possible variations in foreign
exchange rates. Such transactions may be effected with respect to
hedges on non-US dollar denominated securities owned by the Fund,
sold by the Fund but not yet delivered, or committed or anticipated
to be purchased by the Fund.
* Financial futures contracts--The Fund may purchase or sell
financial futures contracts and options on such futures contracts
for the purpose of hedging the market risk on existing securities or
the intended purchase of securities. Futures contracts are contracts
for delayed delivery of securities at a specific future date and at
a specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as variation margin
and are recorded by the Fund as unrealized gains or losses. When the
contract is closed, the Fund records a realized gain or loss equal
to the difference between the value of the contract at the time it
was opened and the value at the time it was closed.
(e) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required. Under the applicable foreign tax law, a
withholding tax may be imposed on interest, dividends, and capital
gains at various rates.
(f) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Dividend income is recorded on the ex-
dividend dates. Dividends from foreign securities where the ex-
dividend date may have passed are subsequently recorded when the
Fund has determined the ex-dividend date. Interest income (including
amortization of discount) is recognized on the accrual basis.
Realized gains and losses on security transactions are determined on
the identified cost basis.
(g) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense on a straight-
line basis over a period not exceeding five years. Prepaid
registration fees are charged to expense as the related shares are
issued.
(h) Dividends and distributions--Dividends and distributions paid by
the Fund are recorded on the ex-dividend dates.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect wholly-
owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is
the limited partner. The Fund has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor ("MLFD" or "Distributor"), a division of Princeton Funds
Distributor, Inc. ("PFD"), which is a wholly-owned subsidiary of
Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee of 0.75%, on an annual basis,
of the average daily value of the Fund's net assets.
Pursuant to the Distribution Plans adopted by the Fund in accordance
with Rule 12b-1 under the Investment Company Act of 1940, the Fund
pays the Distributor ongoing account maintenance and distribution
fees. The fees are accrued daily and paid monthly at annual rates
based upon the average daily net assets of the shares as follows:
Account Distribution
Maintenance Fee Fee
Class B 0.25% 0.75%
Class C 0.25% 0.75%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
For the six months ended June 30, 1998, MLFD earned underwriting
discounts and direct commissions and MLPF&S earned dealer
concessions on sales of the Fund's Class A and Class D Shares as
follows:
MLFD MLPF&S
Class A $ 307 $ 3,978
Class D $40,393 $554,273
For the six months ended June 30, 1998, MLPF&S received contingent
deferred sales charges of $1,635,335 and $26,695 relating to
transactions in Class B and Class C Shares, respectively.
In addition, MLPF&S received $50,170 in commissions on the execution
of portfolio security transactions for the Fund for the six months
ended June 30, 1998.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of MLAM, PSI, MLFDS, PFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended June 30, 1998 were $1,007,619,102 and
$528,684,617, respectively.
Net realized gains for the six months ended June 30, 1998 and net
unrealized gains as of June 30, 1998 were as follows:
Realized Unrealized
Gains Gains
Long-term investments $ 111,740,664 $ 357,081,958
Foreign currency options purchased -- 9,555,000
Forward foreign exchange contracts 1,785,270 12,405,456
Foreign currency transactions 26,171,423 24,773
------------- -------------
Total $ 139,697,357 $ 379,067,187
============= =============
As of June 30, 1998, net unrealized appreciation for Federal income
tax purposes aggregated $357,081,958, of which $461,432,491 related
to appreciated securities and $104,350,533 related to depreciated
securities. The aggregate cost of investments at June 30, 1998 for
Federal income tax purposes was $2,220,017,599.
4. Capital Share Transactions:
Net increase in net assets derived from capital share transactions
was $539,834,986, $81,836,169 and $1,483,455,823 for the six months
ended June 30, 1998, for the period November 1, 1997 to December 31,
1997 and for the year ended October 31, 1997, respectively.
Transactions in capital shares for each class were as follows:
Class A Shares for the Six Months Dollar
Ended June 30, 1998 Shares Amount
Shares sold 6,986,534 $ 94,826,514
Shares issued to shareholders in
reinvestment of dividends and
distributions 60,101 834,801
------------- --------------
Total issued 7,046,635 95,661,315
Shares redeemed (837,287) (11,481,386)
------------- --------------
Net increase 6,209,348 $ 84,179,929
============= ==============
Class A Shares for
the Period November 1, 1997 Dollar
to December 31, 1997 Shares Amount
Shares sold 751,738 $ 9,068,512
Shares issued to shareholders in
reinvestment of dividends and
distributions 114,753 1,374,743
------------- --------------
Total issued 866,491 10,443,255
Shares redeemed (162,478) (1,970,638)
------------- --------------
Net increase 704,013 $ 8,472,617
============= ==============
Class A Shares for
the Period November 1, 1996++ Dollar
to October 31, 1997 Shares Amount
Shares sold 5,152,431 $ 57,303,237
Shares issued to shareholders in
reinvestment of dividends 6,207 62,009
------------- --------------
Total issued 5,158,638 57,365,246
Shares redeemed (614,043) (6,856,145)
------------- --------------
Net increase 4,544,595 $ 50,509,101
============= ==============
[FN]
++Prior to November 1, 1996 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class B Shares for the Six Months Dollar
Ended June 30, 1998 Shares Amount
Shares sold 30,699,979 $ 420,402,634
Shares issued to shareholders in
reinvestment of dividends and
distributions 1,082,980 14,945,123
------------- --------------
Total issued 31,782,959 435,347,757
Automatic conversion of shares (312,663) (4,152,924)
Shares redeemed (8,383,885) (112,317,122)
------------- --------------
Net increase 23,086,411 $ 318,877,711
============= ==============
Merrill Lynch Global Value Fund, Inc., June 30, 1998
NOTES TO FINANCIAL STATEMENTS (concluded)
Class B Shares for
the Period November 1, 1997 Dollar
to December 31, 1997 Shares Amount
Shares sold 3,154,767 $ 38,080,734
Shares issued to shareholders in
reinvestment of dividends and
distributions 3,339,542 39,874,138
------------- --------------
Total issued 6,494,309 77,954,872
Automatic conversion of shares (82,508) (986,113)
Shares redeemed (2,355,726) (28,418,784)
------------- --------------
Net increase 4,056,075 $ 48,549,975
============= ==============
Class B Shares for
the Period November 1, 1996++ Dollar
to October 31, 1997 Shares Amount
Shares sold 109,016,851 $1,127,788,851
Shares issued to shareholders in
reinvestment of dividends 211,285 2,110,732
------------- --------------
Total issued 109,228,136 1,129,899,583
Automatic conversion of shares (207,246) (2,300,318)
Shares redeemed (8,455,332) (92,416,446)
------------- --------------
Net increase 100,565,558 $1,035,182,819
============= ==============
[FN]
++Prior to November 1, 1996 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class C Shares for the Six Months Dollar
Ended June 30, 1998 Shares Amount
Shares sold 6,231,652 $ 85,368,269
Shares issued to shareholders in
reinvestment of dividends and
distributions 204,798 2,826,217
------------- --------------
Total issued 6,436,450 88,194,486
Shares redeemed (1,687,844) (22,647,323)
------------- --------------
Net increase 4,748,606 $ 65,547,163
============= ==============
Class C Shares for
the Period November 1, 1997 Dollar
to December 31, 1997 Shares Amount
Shares sold 571,308 $ 6,886,306
Shares issued to shareholders in
reinvestment of dividends and
distributions 629,854 7,520,456
------------- --------------
Total issued 1,201,162 14,406,762
Shares redeemed (549,914) (6,625,250)
------------- --------------
Net increase 651,248 $ 7,781,512
============= ==============
Class C Shares for
the Period November 1, 1996++ Dollar
to October 31, 1997 Shares Amount
Shares sold 20,686,388 $ 214,642,345
Shares issued to shareholders in
reinvestment of dividends 39,137 390,984
------------- --------------
Total issued 20,725,525 215,033,329
Shares redeemed (2,190,092) (23,679,275)
------------- --------------
Net increase 18,535,433 $ 191,354,054
============= ==============
[FN]
++Prior to November 1, 1996 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class D Shares for the Six Months Dollar
Ended June 30, 1998 Shares Amount
Shares sold 7,460,164 $ 101,901,034
Automatic conversion of shares 311,180 4,152,924
Shares issued to shareholders in
reinvestment of dividends and
distributions 251,591 3,489,569
------------- --------------
Total issued 8,022,935 109,543,527
Shares redeemed (2,888,782) (38,313,344)
------------- --------------
Net increase 5,134,153 $ 71,230,183
============= ==============
Class D Shares for
the Period November 1, 1997 Dollar
to December 31, 1997 Shares Amount
Shares sold 1,489,446 $ 18,112,269
Automatic conversion of shares 81,951 986,113
Shares issued to shareholders in
reinvestment of dividends and
distributions 783,234 9,375,306
------------- --------------
Total issued 2,354,631 28,473,688
Shares redeemed (933,276) (11,441,623)
------------- --------------
Net increase 1,421,355 $ 17,032,065
============= ==============
Class D Shares for
the Period November 1, 1996++ Dollar
to October 31, 1997 Shares Amount
Shares sold 22,812,954 $ 235,349,723
Automatic conversion of shares 206,573 2,300,318
Shares issued to shareholders in
reinvestment of dividends 62,231 621,693
------------- --------------
Total issued 23,081,758 238,271,734
Shares redeemed (2,934,997) (31,861,885)
------------- --------------
Net increase 20,146,761 $ 206,409,849
============= ==============
[FN]
++Prior to November 1, 1996 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
PORTFOLIO CHANGES
Additions
For the Quarter Ended June 30, 1998
ADC Telecommunications, Inc.
National Power PLC
Schlumberger Ltd.
Toyo Seikan Kaisha, Ltd.
Village Roadshow Limited (Convertible Preferred)
Deletions
CBS Corporation
Koninklijke PTT Nederland N.V.
Sankyo Company, Limited
Suzuki Motor Corporation
Tele Danmark A/S
