MERRILL LYNCH
GLOBAL VALUE
FUND, INC.
FUND LOGO
Semi-Annual Report
June 30, 1999
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 6/30/99
Percent of
Ten Largest Industries Net Assets
Utilities--Electric & Gas 14.0%
Banking 12.1
Insurance 10.3
Food & Household Products 8.5
Health & Personal Care 8.2
Telecommunications 8.2
Electronic Components & Instruments 7.4
Data Processing & Reproduction 6.6
Financial Services 4.8
Leisure & Tourism 4.5
Country of Percent of
Ten Largest Equity Holdings Origin Net Assets
The AES Corporation United States 6.1%
Berkshire Hathaway Inc. (Class A) United States 5.2
Cadbury Schweppes PLC United Kingdom 4.7
Lattice Semiconductor Corporation United States 4.5
Hewlett-Packard Company United States 4.4
AT&T Corp. United States 4.4
Federal National Mortgage
Association United States 4.3
Monsanto Company United States 4.2
Frontier Corporation United States 3.8
Nestle SA (Registered Shares) Switzerland 3.8
Merrill Lynch Global Value Fund, Inc., June 30, 1999
DEAR SHAREHOLDER
Merrill Lynch Global Value Fund, Inc.'s Class A and Class D Shares
had total returns of +0.23% and +0.15%, respectively, for the
quarter ended June 30, 1999. Total returns for Class B and Class C
Shares were flat. These results compare to a +4.77% total return for
the unmanaged Morgan Stanley Capital International (MSCI) World
Index. For the first six months of 1999, the Fund underperformed the
MSCI World Index, with the Class A, Class B, Class C, and Class D
Shares providing total returns of -2.41%, -2.87%, -2.87% and -2.49%,
respectively, compared to a +8.51% total 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.)
Investment Environment
We regret to report that in the June quarter, the Fund continued its
recent disappointing performance. Once again, the source of the
underperformance was poor stock selection, since currency and other
factors essentially cancelled each other out. Although a number of
individual issues, including The AES Corporation, Frontier
Corporation and Lattice Semiconductor Corporation showed excellent
performance during the quarter, these gains were offset by declines
in some of our largest holdings. We discussed one of these, McKesson
HBOC, Inc., in our last report to shareholders. We eliminated the
position in McKesson HBOC stock during the June quarter. Given the
size of our position and magnitude of the stock price decline (50%
in the day after the company's first disclosure of overstated
revenues at HBOC), the net asset value of the Fund's Class A Shares
declined by 2.5% from this position alone. McKesson HBOC's current
share price may indicate that investors are now valuing the HBOC
portion of the company at less than zero (namely, the McKesson
portion is now selling at a lower level than before). However, we do
not feel comfortable maintaining investments in companies in which
we must make judgments about management ethics and the veracity of
the company's public disclosures and financial statements.
Notwithstanding the performance of McKesson HBOC, our stock
selection was not nearly as poor as our overall June quarter results
suggest. Excluding McKesson HBOC, our US investments actually
outperformed the US component of the benchmark unmanaged MSCI World
Index. In addition, our three largest positions in Japan
outperformed the market substantially, but overall the portfolio's
Japanese stocks underperformed the market modestly. Unfortunately,
the Fund's UK and German stocks underperformed their broader
markets.
The US market continued its strong performance in the quarter,
posting a total return of just over 7%. Fully 5% of the United
States' 7% return for the quarter came in the last five days after
the Federal Reserve Board appeared to abandon its bias to raise
interest rates. As in the first quarter, the June quarter was
characterized by good performance in traditional deep value stocks
as well as traditional growth names, two categories we do not
typically gravitate toward in selecting stocks for inclusion in the
Fund.
In contrast to many quarters over the past two years, the US stock
market was not the best-performing stock market during the June
quarter. During the period, the US market lagged both the European
markets overall as well as Japan in local currency terms. Although
most markets moved together for the first half of the quarter,
Europe strongly out-performed from the middle of May onward,
returning more than two percentage points greater than the United
States. The sharp decline in the euro (-3.82% relative to the US
dollar during the June quarter) still meant the United States
outperformed European markets in US dollar terms. On the other hand,
the yen appreciated slightly during the quarter (+1.85% relative to
the US dollar) in addition to the Japanese stock market's +9.81%
return, making it the top-performing major market in US dollar
terms.
Portfolio Matters
The portfolio underwent relatively few changes during the June
quarter with only three positions eliminated and two initiated. For
the most part, we are very satisfied with our positions and added to
selected issues during the quarter. For example, during the last
quarter, as well as during the financial crisis of last August, we
increased our position in Allied Irish Banks PLC, which the Fund has
held since February 1997. While this investment has already provided
our shareholders with returns that exceeded those of the average
European banks and stocks by a wide margin, we continue to believe
that Allied Irish Banks is a very attractive investment at current
prices.
We believe that Allied Irish Banks is a very profitable and
conservatively managed bank with a leading position in Ireland, the
fastest growing economy in Europe. It also has profitable banking
operations in Maryland and Pennsylvania, a commercial banking
business in England, and significant new operations in the rapidly
expanding economy of Poland. Allied Irish Banks focuses primarily on
the retail and medium-size commercial banking segments and so does
not appear to face the risks associated with financial institutions
involved in derivatives, trading or foreign lending. Despite these
advantages, Allied Irish Banks shares sell at a discount to many
European banks and we expect the company to continue to outperform
relative to its competitors because of better growth prospects.
In our last letter to shareholders, we described Becton, Dickinson
and Company as having suffered a temporary earnings setback in the
December quarter, which provided us with the opportunity to buy a
company with above-average earnings growth at a discount to the
average stock in the Standard & Poor's 500 Index. After exceeding
investors' earnings expectations in the March quarter, Becton,
Dickinson once again disappointed its shareholders by announcing in
mid-June that second-quarter earnings would fall short of prior
management expectations. Management blamed the shortfall on three
factors: negative foreign currency translation, weaker-than-expected
sales in western Europe and certain emerging markets, and
underperformance in its home healthcare business. Although we are
disappointed by these results, we have maintained our position in
Becton, Dickinson stock. First, the shortfall was not related to the
company's core businesses, which continue to show good growth in
line with our expectations. Second, the company's shares are now
valued at a 35% discount to the average Standard & Poor's (S&P) 500
stock, despite an earnings growth rate that is still at least 50%
higher than the average S&P 500 company.
How We Define Value
Despite the results of the first half of 1999, we remain confident
in our investment process and approach. It is important for
shareholders to understand what we do and do not do. Our approach to
value is somewhat different from how many might understand value
investing. Traditional value investing looks primarily at valuation,
seeking stocks with low price/earnings or low price/book value
ratios, for example. These stocks are typically concentrated in
industries with low profitability and/or low growth, resulting in
investments in companies with low earnings growth or poor
performance. In contrast, at Merrill Lynch Global Value Fund, Inc.,
our definition of value comprises stocks we believe are sensibly
worth more than they are selling for, generally based on an in-depth
cash flow evaluation.
Our largest point of difference with traditional value investors is
our preference for companies whose economic value accretes by
10%--15% per year while their current stock prices appear undervalued.
For that reason, we tend to avoid deep cyclicals and commodity
stocks. Although we recognize that investors can profit from such
investments, we are not comfortable investing in industries with
poor returns and/or growth in expectations of cyclical upturns.
Thus, our universe of stocks is different from that of traditional
value investors. Accordingly, we can theoretically hold what some
might view as a growth company, such as our investment in MCI
WorldCom Inc. last year. However, we do not believe we can justify
the current valuation of most growth stocks (using cautious growth
assumptions) and therefore are unlikely to own them.
Two other characteristics define our investment approach. First, as
discussed in previous reports to shareholders, we believe that a
company should provide a "margin of safety" for the Fund. As we
define the phrase, this margin of safety can be balance sheet
strength, hidden assets, or the strength of a company's franchise in
its industry, among other factors. Second, our approach dictates
that we invest only in those companies that we believe make up our
best investment ideas. We do not add stocks to the portfolio if we
are lukewarm about them. We feel that shareholders are best served
by an approach that does not dilute our best investment thinking.
Nevertheless, we can and do make mistakes. Since we take relatively
larger positions in fewer stocks than most funds, the impact of a
poor investment decision is more readily visible. By the same token,
a good decision has a disproportionate beneficial impact on
performance. If, on balance, we make more good decisions than poor
ones and we are aided by favorable market conditions, we hope to
produce meaningful excess returns over the long term. If we achieve
this goal, we will have done a good job for you, our shareholders.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Director
(Stephen I. Silverman)
Stephen I. Silverman
Senior Vice President and
Portfolio Manager
August 16, 1999
Merrill Lynch Global Value Fund, Inc., June 30, 1999
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 +3.61% +0.23% +56.62%
ML Global Value Fund, Inc. Class B Shares +2.62 0.00 +52.49
ML Global Value Fund, Inc. Class C Shares +2.60 0.00 +52.47
ML Global Value Fund, Inc. Class D Shares +3.39 +0.15 +55.58
<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's inception date is 11/01/96.
</TABLE>
Average Annual
Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 6/30/99 + 3.61% - 1.83%
Inception (11/01/96) through 6/30/99 +18.37 +15.99
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 6/30/99 + 2.62% - 1.23%
Inception (11/01/96) through 6/30/99 +17.19 +16.61
[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 6/30/99 + 2.60% + 1.64%
Inception (11/01/96) through 6/30/99 +17.18 +17.18
[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 6/30/99 + 3.39% - 2.04%
Inception (11/01/96) through 6/30/99 +18.08 +15.71
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
OFFICERS AND DIRECTORS
Terry K. Glenn, President and Director
Donald Cecil, Director
Roland M. Machold, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
Richard R. West, Director
Arthur Zeikel, Director
Edward D. Zinbarg, Director
Stephen I. Silverman, Senior Vice President and
Portfolio Manager
Donald C. Burke, Vice President and Treasurer
Barbara G. Fraser, Secretary
Custodian
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
Merrill Lynch Global Value Fund, Inc., June 30, 1999
<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-- 1,521,600 Canadian National Railway
Road & Rail Company $ 74,424,143 $ 101,947,200 3.5%
Total Investments in Canada 74,424,143 101,947,200 3.5
United Banking 1,176,300 The Chase Manhattan Corporation 102,051,319 101,896,987 3.6
States 2,460,400 Washington Mutual, Inc. 94,374,063 87,036,650 3.0
------------- ------------- ------
196,425,382 188,933,637 6.6
Data Processing & 1,264,200 Hewlett-Packard Company 101,794,007 127,052,100 4.4
Reproduction
Electronic 2,070,700 ++Lattice Semiconductor
Components & Corporation*** 104,996,064 128,383,400 4.5
Instruments
Financial Services 1,827,400 Federal National Mortgage
Association 79,099,130 124,948,475 4.3
209,900 ++The Goldman Sachs Group, Inc. 11,124,700 15,165,275 0.5
------------- ------------- ------
90,223,830 140,113,750 4.8
Health & Personal 2,860,300 Becton, Dickinson and Company 102,202,839 85,809,000 3.0
Care 575,700 Guidant Corporation 30,494,089 29,612,569 1.0
3,095,400 Monsanto Company 127,705,641 122,074,838 4.2
------------- ------------- ------
260,402,569 237,496,407 8.2
Insurance 2,160 ++Berkshire Hathaway Inc.
(Class A) 133,124,596 148,824,000 5.2
Leisure & Tourism 3,155,200 The Walt Disney Company 99,888,740 97,219,600 3.4
Telecommunications 2,262,600 AT&T Corp. 127,309,003 126,281,362 4.4
1,880,000 Frontier Corporation 58,778,473 110,920,000 3.8
------------- ------------- ------
186,087,476 237,201,362 8.2
Utilities-- 3,007,400 ++The AES Corporation 97,611,738 174,805,125 6.1
Electric & 1,225,950 Columbia Energy Group 63,217,999 76,851,741 2.6
Gas 2,095,500 K N Energy, Inc. 78,302,281 28,027,312 1.0
1,830,000 Unicom Corporation 57,049,442 70,569,375 2.4
------------- ------------- ------
296,181,460 350,253,553 12.1
Total Investments in the
United States 1,469,124,124 1,655,477,809 57.4
Total Investments in
North America 1,543,548,267 1,757,425,009 60.9
PACIFIC BASIN
Australia Leisure & Tourism 11,800,652 Village Roadshow Limited
'A' (Preferred) 30,727,549 17,652,525 0.6
360,000 Village Roadshow Limited
(Convertible Preferred)++++ 18,000,000 14,040,000 0.5
------------- ------------- ------
48,727,549 31,692,525 1.1
Real Estate 3,506,367 Lend Lease Corporation Limited 33,093,970 48,141,689 1.7
Total Investments in Australia 81,821,519 79,834,214 2.8
Japan Appliances & 953,000 Matsushita Electric Industrial
Household Durables Company, Ltd. 17,443,427 18,511,737 0.6
400,000 Sony Corporation 36,894,499 43,147,628 1.5
------------- ------------- ------
54,337,926 61,659,365 2.1
Construction & 1,105,602 Chudenko Corporation 25,974,605 20,196,565 0.7
Housing 788,000 Kinden Corporation 9,663,415 8,500,083 0.3
------------- ------------- ------
35,638,020 28,696,648 1.0
Data Processing & 2,166,000 Canon, Inc. 51,626,097 62,305,174 2.2
Reproduction
Electronic 1,276,000 Murata Manufacturing Co., Ltd. 39,076,429 83,955,695 2.9
Components &
Instruments
Insurance 3,438,000 The Dai-Tokyo Fire and Marine
Insurance Co., Ltd. 13,781,868 12,361,795 0.4
784,000 The Nichido Fire & Marine
Insurance Co., Ltd. 4,117,378 4,037,295 0.2
4,411,000 The Sumitomo Marine & Fire
Insurance Co., Ltd. 30,544,736 26,616,218 0.9
850,000 The Tokio Marine & Fire
Insurance Co. Ltd. 10,618,405 9,239,130 0.3
------------- ------------- ------
59,062,387 52,254,438 1.8
Miscellaneous 10,000 Toyo Seikan Kaisha, Ltd. 106,000 224,831 0.0
Materials &
Commodities
Total Investments in Japan 239,846,859 289,096,151 10.0
Total Investments in the
Pacific Basin 321,668,378 368,930,365 12.8
WESTERN
EUROPE
Denmark Banking 716,200 Den Danske Bank Group 95,868,098 77,608,042 2.7
Total Investments in Denmark 95,868,098 77,608,042 2.7
Germany Insurance 129,700 Hannover Rueckversicherungs-AG 14,461,879 10,359,334 0.4
Transportation-- 3,120,200 Deutsche Lufthansa AG
Airlines (Registered Shares) 54,760,129 56,531,621 2.0
Utilities-- 3,621,300 Bewag Aktiengesellschaft 79,992,542 55,795,071 1.9
Electric &
Gas
Total Investments in Germany 149,214,550 122,686,026 4.3
Ireland Banking 6,137,000 Allied Irish Banks PLC 60,909,250 81,213,130 2.8
28,500 Allied Irish Banks PLC (ADR)* 482,133 776,625 0.0
Total Investments in Ireland 61,391,383 81,989,755 2.8
Switzerland Food & Household 60,800 Nestle SA (Registered Shares) 67,899,128 109,680,428 3.8
Products
Total Investments in Switzerland 67,899,128 109,680,428 3.8
United Food & Household 21,333,600 Cadbury Schweppes PLC 98,719,504 135,780,172 4.7
Kingdom Products
Insurance 6,527,900 Allied Zurich PLC 97,252,574 82,015,328 2.9
Total Investments in the
United Kingdom 195,972,078 217,795,500 7.6
Total Investments in
Western Europe 570,345,237 609,759,751 21.2
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1999
<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 $114,668,000 General Electric Capital Corp.,
Paper** 5.75% due 7/01/1999 $ 114,668,000 $ 114,668,000 4.0%
Total Investments in
Short-Term Securities 114,668,000 114,668,000 4.0
OPTIONS Nominal Value Premiums
PURCHASED Covered by Options Paid
Currency Put 176,640,000 Japanese Yen, expiring August
1999 at YEN 150 7,604,352 1,766 0.0
Options Purchased 100,000,000 Japanese Yen, expiring June
2000 at YEN 123 2,500,000 2,730,000 0.1
300,000,000 Japanese Yen, expiring June
2000 at YEN 124 7,635,000 7,371,000 0.2
100,000,000 Japanese Yen, expiring June
2000 at YEN 124 2,460,000 2,476,000 0.1
Total Options Purchased 20,199,352 12,578,766 0.4
Total Investments 2,570,429,234 2,863,361,891 99.3
OPTIONS Premiums
WRITTEN Received
Call Options 782,000 The AES Corporation, expiring
Written November 1999 at US$63.36 (2,394,797) (3,714,500) (0.1)
549,600 Monsanto Company, expiring
December 1999 at US$50 (1,346,520) (1,187,136) 0.0
915,800 Monsanto Company, expiring
December 1999 at US$51.1242 (1,992,689) (1,923,180) (0.1)
Total Options Written (5,734,006) (6,824,816) (0.2)
Total Investments, Net of Options Written $2,564,695,228 2,856,537,075 99.1
==============
Unrealized Appreciation on Forward Foreign Exchange Contracts--Net++++++ 27,291,805 0.9
Liabilities in Excess of Other Assets (63,709) 0.0
-------------- ------
Net Assets $2,883,765,171 100.0%
============== ======
<FN>
*American Depositary Receipts (ADR).
**Commercial Paper is traded on a discount basis; the interest rate
shown reflects the discount rate paid at the time of purchase by the Fund.
***Investments 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)
were as follows:
Net Share Net Dividend
Industry Affiliate Activity Cost Income
Electronic Lattice -- -- +++
Components & Semiconductor
Instruments Corporation
+++Non-income producing security.
++Non-income producing security.
++++The security may be offered and sold to "qualified institutional
buyers" under Rule 144A of the Securities Act of 1933.
++++++Forward foreign exchange contracts as of June 30, 1999 were as
follows:
Foreign Unrealized
Currency Expiration Appreciation
Sold Date (Note 1d)
Chf 43,726,686 September 1999 $ 4,953,518
Dkr 482,520,640 September 1999 9,495,609
Pound Sterling 99,850,823 September 1999 7,635,593
YEN 11,024,865,351 September 1999 5,207,085
-----------
Total Unrealized Appreciation on
Forward Foreign Exchange Contracts--Net
(US$ Commitment--$372,804,865) $27,291,805
===========
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of June 30, 1999
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$2,550,229,882)(Note 1a) $2,850,783,125
Put options purchased, at value (cost--$20,199,352)(Notes 1a & 1d) 12,578,766
Unrealized appreciation on forward foreign exchange
contracts (Note 1d) 27,291,805
Cash 5,743,818
Foreign cash (Note 1c) 1,794,284
Receivables:
Dividends $ 3,316,671
Capital shares sold 1,983,328
Forward foreign exchange contracts (Note 1d) 828,958 6,128,957
--------------
Deferred organization expenses (Note 1g) 57,761
Prepaid registration fees and other assets (Note 1g) 137,049
--------------
Total assets 2,904,515,565
--------------
Liabilities: Call options written, at value (premiums received--$5,734,006)
(Notes 1a & 1d) 6,824,816
Payables:
Capital shares redeemed 8,720,587
Distributor (Note 2) 2,150,641
Investment adviser (Note 2) 1,956,894 12,828,122
--------------
Accrued expenses and other liabilities 1,097,456
--------------
Total liabilities 20,750,394
--------------
Net Assets: Net assets $2,883,765,171
==============
Net Assets Class A Shares of Common Stock, $.10 par value,
Consist of: 100,000,000 shares authorized $ 1,430,438
Class B Shares of Common Stock, $.10 par value,
300,000,000 shares authorized 14,608,779
Class C Shares of Common Stock, $.10 par value,
100,000,000 shares authorized 2,591,172
Class D Shares of Common Stock, $.10 par value,
100,000,000 shares authorized 3,154,851
Paid-in capital in excess of par 2,467,567,972
Undistributed investment income--net 8,836,013
Undistributed realized capital gains on investments and
foreign currency transactions--net 66,484,499
Unrealized appreciation on investments and foreign
currency transactions--net 319,091,447
--------------
Net assets $2,883,765,171
==============
Net Asset Class A--Based on net assets of $190,827,747 and
Value: 14,304,377 shares outstanding $ 13.34
==============
Class B--Based on net assets of $1,930,588,754 and
146,087,792 shares outstanding $ 13.22
==============
Class C--Based on net assets of $342,437,594 and
25,911,717 shares outstanding $ 13.22
==============
Class D--Based on net assets of $419,911,076 and
31,548,505 shares outstanding $ 13.31
==============
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1999
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Six Months Ended June 30, 1999
<S> <S> <C> <C>
Investment Dividends (net of $1,270,502 foreign withholding tax) $ 19,937,549
Income Interest and discount earned 2,741,598
(Notes 1e & 1f): --------------
Total income 22,679,147
--------------
Expenses: Investment advisory fees (Note 2) $ 11,054,785
Account maintenance and distribution fees--Class B (Note 2) 9,853,574
Account maintenance and distribution fees--Class C (Note 2) 1,750,058
Transfer agent fees--Class B (Note 2) 1,025,893
Account maintenance fees--Class D (Note 2) 528,865
Custodian fees 443,645
Transfer agent fees--Class C (Note 2) 189,715
Registration fees (Note 1g) 182,524
Transfer agent fees--Class D (Note 2) 179,630
Printing and shareholder reports 117,503
Accounting services (Note 2) 88,561
Transfer agent fees--Class A (Note 2) 86,426
Professional fees 54,259
Directors' fees and expenses 20,867
Amortization of organization expenses (Note 1g) 9,288
Pricing fees 3,754
Other 13,963
--------------
Total expenses 25,603,310
--------------
Investment loss--net (2,924,163)
--------------
Realized & Realized gain (loss) from:
Unrealized Gain Investments--net (127,429)
(Loss) on Foreign currency transactions--net 1,211,459 1,084,030
Investments & --------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net (112,492,733)
(Notes 1c, 1d, Foreign currency transactions--net 30,251,747 (82,240,986)
1f & 3): -------------- --------------
Net realized and unrealized loss on investments
and foreign currency transactions (81,156,956)
--------------
Net Decrease in Net Assets Resulting from Operations $ (84,081,119)
==============
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the
Months Ended Year Ended
June 30, Dec. 31,
Increase (Decrease) in Net Assets: 1999 1998
<S> <S> <C> <C>
Operations: Investment income (loss)--net $ (2,924,163) $ 14,662,644
Realized gain on investments and foreign
currency transactions--net 1,084,030 273,114,836
Change in unrealized appreciation/depreciation on
investments and foreign currency transactions--net (82,240,986) 224,291,590
-------------- --------------
Net increase (decrease) in net assets resulting
from operations (84,081,119) 512,069,070
-------------- --------------
Dividends & Investment income--net:
Distributions to Class A -- (1,613,920)
Shareholders Class B -- (9,798,677)
(Note 1h): Class C -- (1,789,955)
Class D -- (3,260,316)
In excess of investment income--net:
Class A -- (2,417,667)
Class B -- (14,678,505)
Class C -- (2,681,369)
Class D -- (4,883,982)
Realized gain on investments--net:
Class A -- (15,004,582)
Class B -- (154,619,783)
Class C -- (28,383,994)
Class D -- (32,551,670)
-------------- --------------
Net decrease in net assets resulting from
dividends and distributions to shareholders -- (271,684,420)
-------------- --------------
Capital Share Net increase (decrease) in net assets derived
Transactions from capital share transactions (13,961,006) 937,922,226
(Note 4): -------------- --------------
Net Assets: Total increase (decrease) in net assets (98,042,125) 1,178,306,876
Beginning of period 2,981,807,296 1,803,500,420
-------------- --------------
End of period* $2,883,765,171 $2,981,807,296
============== ==============
<FN>
*Undistributed investment income--net $ 8,836,013 $ 11,760,176
============== ==============
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1999
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
Class A++++
For the Six For the For the For the
The following per share data and ratios have been derived Months Year Period Year
from information provided in the financial statements. Ended Ended Nov. 1, 1997 Ended
June 30, Dec. 31, to Dec. 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1997++
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 13.67 $ 12.01 $ 11.83 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income--net .04 .18 .01 .17
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (.37) 3.00 .72 1.71
---------- ---------- ---------- ----------
Total from investment operations (.33) 3.18 .73 1.88
---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net -- (.14) (.11) (.05)
In excess of investment income--net -- (.20) -- --
Realized gain on investments--net -- (1.18) (.44) --
---------- ---------- ---------- ----------
Total dividends and distributions -- (1.52) (.55) (.05)
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.34 $ 13.67 $ 12.01 $ 11.83
========== ========== ========== ==========
Total Investment Based on net asset value per share (2.41%)+++ 27.10% 6.19%+++ 18.91%
Return:** ========== ========== ========== ==========
Ratios to Average Expenses .90%* .90% .96%* .97%
Net Assets: ========== ========== ========== ==========
Investment income--net .64%* 1.32% .54%* 1.88%
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $ 190,828 $ 202,980 $ 63,075 $ 53,776
Data: ========== ========== ========== ==========
Portfolio turnover 34.28% 44.94% 24.49% 77.65%
========== ========== ========== ==========
<CAPTION>
Class B++++
For the Six For the For the For the
The following per share data and ratios have been derived Months Year Period Year
from information provided in the financial statements. Ended Ended Nov. 1, 1997 Ended
June 30, Dec. 31, to Dec. 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1997++
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 13.61 $ 11.97 $ 11.72 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income (loss)--net (.02) .06 (.01) .09
Realized and unrealized gain (loss)
on investments and foreign currency
transactions--net (.37) 2.96 .73 1.67
---------- ---------- ---------- ----------
Total from investment operations (.39) 3.02 .72 1.76
---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net -- (.08) (.03) (.04)
In excess of investment income--net -- (.12) -- --
Realized gain on investments--net -- (1.18) (.44) --
---------- ---------- ---------- ----------
Total dividends and distributions -- (1.38) (.47) (.04)
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.22 $ 13.61 $ 11.97 $ 11.72
========== ========== ========== ==========
Total Investment Based on net asset value per share (2.87%)+++ 25.76% 6.14%+++ 17.62%
Return:** ========== ========== ========== ==========
Ratios to Average Expenses 1.92%* 1.92% 1.98%* 1.99%
Net Assets: ========== ========== ========== ==========
Investment income (loss)--net (.38%)* .44% (.49%)* .84%
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $1,930,589 $1,988,580 $1,251,956 $1,179,125
Data: ========== ========== ========== ==========
Portfolio turnover 34.28% 44.94% 24.49% 77.65%
========== ========== ========== ==========
<CAPTION>
Class C++++
For the Six For the For the For the
The following per share data and ratios have been derived Months Year Period Year
from information provided in the financial statements. Ended Ended Nov. 1, 1997 Ended
June 30, Dec. 31, to Dec. 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1997++
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 13.61 $ 11.97 $ 11.72 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income (loss)--net (.03) .06 (.01) .09
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (.36) 2.96 .73 1.67
---------- ---------- ---------- ----------
Total from investment operations (.39) 3.02 .72 1.76
---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net -- (.08) (.03) (.04)
In excess of investment income--net -- (.12) -- --
Realized gain on investments--net -- (1.18) (.44) --
---------- ---------- ---------- ----------
Total dividends and distributions -- (1.38) (.47) (.04)
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.22 $ 13.61 $ 11.97 $ 11.72
========== ========== ========== ==========
Total Investment Based on net asset value per share (2.87%)+++ 25.73% 6.14%+++ 17.62%
Return:** ========== ========== ========== ==========
Ratios to Average Expenses 1.92%* 1.92% 1.98%* 1.99%
Net Assets: ========== ========== ========== ==========
Investment income (loss)--net (.39%)* .43% (.49%)* .83%
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $ 342,437 $ 363,134 $ 229,601 $ 217,341
Data: ========== ========== ========== ==========
Portfolio turnover 34.28% 44.94% 24.49% 77.65%
========== ========== ========== ==========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
++The Fund commenced operations on November 1, 1996.
++++Based on average shares outstanding.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Value Fund, Inc., June 30, 1999
<TABLE>
FINANCIAL HIGHLIGHTS (concluded)
<CAPTION>
Class D++++
For the Six For the For the For the
The following per share data and ratios have been derived Months Year Period Year
from information provided in the financial statements. Ended Ended Nov. 1, 1997 Ended
June 30, Dec. 31, to Dec. 31, Oct. 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1997++
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 13.65 $ 12.00 $ 11.80 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income--net .03 .16 .01 .18
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (.37) 2.98 .72 1.67
---------- ---------- ---------- ----------
Total from investment operations (.34) 3.14 .73 1.85
---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net -- (.12) (.09) (.05)
In excess of investment income--net -- (.19) -- --
Realized gain on investments--net -- (1.18) (.44) --
---------- ---------- ---------- ----------
Total dividends and distributions -- (1.49) (.53) (.05)
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.31 $ 13.65 $ 12.00 $ 11.80
========== ========== ========== ==========
Total Investment Based on net asset value per share (2.49%)+++ 26.72% 6.20%+++ 18.56%
Return:** ========== ========== ========== ==========
Ratios to Average Expenses 1.15%* 1.15% 1.21%* 1.22%
Net Assets: ========== ========== ========== ==========
Investment income--net .39%* 1.19% .28%* 1.62%
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $ 419,911 $ 427,113 $ 258,868 $ 237,791
Data: ========== ========== ========== ==========
Portfolio turnover 34.28% 44.94% 24.49% 77.65%
========== ========== ========== ==========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
++The Fund commenced operations on November 1, 1996.
++++Based on average shares outstanding.
+++Aggregate total investment return.
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. The Fund's financial statements
are prepared in accordance with generally accepted accounting
principles, which may require the use of management accruals and
estimates. 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 or
purchased are valued at the last sale price in the case of exchange-
traded options. In the case of options traded in the over-the-
counter market, valuation is the last asked price (options written)
or the last bid price (options purchased). 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, 1999
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.
* 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. Distributions in
excess of net investment income are due primarily to differing tax
treatments for foreign currency transactions.
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 the "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 Incorporated ("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, 1999, MLFD earned under-writing
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 $ 144 $ 2,335
Class D $18,442 $228,651
For the six months ended June 30, 1999, MLPF&S received contingent
deferred sales charges of $2,300,776 and $70,577 relating to
transactions in Class B and Class C Shares, respectively.
In addition, MLPF&S received $258,948 in commissions on the
execution of portfolio security transactions for the Fund for the
six months ended June 30, 1999.
Financial Data Services, Inc. ("FDS"), 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, FDS, PFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended June 30, 1999 were $960,470,973 and
$1,003,216,704, respectively.
Net realized gains (losses) for the six months ended June 30, 1999
and net unrealized gains (losses) as of June 30, 1999 were as
follows:
Realized Unrealized
Gains Gains
(Losses) (Losses)
Investments:
Long-term $ 44,139,818 $ 300,553,243
Options written (44,267,247) (1,090,810)
------------- -------------
Total investments (127,429) 299,462,433
Currency transactions:
Options purchased -- (7,620,586)
Foreign currency transactions 382,501 (42,205)
Forward foreign exchange
contracts 828,958 27,291,805
------------- -------------
Total currency transactions 1,211,459 19,629,014
------------- -------------
Total $ 1,084,030 $ 319,091,447
============= =============
Transactions in call options written for the six months ended June
30, 1999 were as follows:
Nominal Value
Covered by Premiums
Written Options Received
Outstanding call options written,
beginning of period 3,480,502 $ 10,137,312
Options closed (1,233,088) (4,403,260)
Options expired (14) (46)
------------- -------------
Outstanding call options
written, end of period 2,247,400 $ 5,734,006
============= =============
As of June 30, 1999, net unrealized appreciation for Federal income
tax purposes aggregated $299,462,433, of which $477,733,455 related
to appreciated securities and $178,271,022 related to depreciated
securities. The aggregate cost of investments, net of premiums
received for options written, at June 30, 1999 for Federal income
tax purposes was $2,544,495,876.
4. Capital Share Transactions:
Net increase (decrease) in net assets derived from capital share
transactions was $(13,961,006) and $937,922,226 for the six months
ended June 30, 1999 and the year ended December 31, 1998,
respectively.
Transactions in capital shares for each class were as follows:
Class A Shares for the Six Months Dollar
Ended June 30, 1999 Shares Amount
Shares sold 4,358,728 $ 58,248,090
Shares redeemed (4,903,392) (65,553,350)
------------- -------------
Net decrease (544,664) $ (7,305,260)
============= =============
Class A Shares for the Year Dollar
Ended December 31, 1998 Shares Amount
Shares sold 11,594,216 $ 157,632,070
Shares issued to shareholders in
reinvestment of dividends and
distributions 700,153 9,347,636
------------- -------------
Total issued 12,294,369 166,979,706
Shares redeemed (2,696,436) (36,354,264)
------------- -------------
Net increase 9,597,933 $ 130,625,442
============= =============
Merrill Lynch Global Value Fund, Inc., June 30, 1999
NOTES TO FINANCIAL STATEMENTS (concluded)
Class B Shares for the Six Months Dollar
Ended June 30, 1999 Shares Amount
Shares sold 20,011,992 $ 265,238,445
Automatic conversion of shares (1,169,670) (15,594,067)
Shares redeemed (18,870,294) (249,903,086)
------------- -------------
Net decrease (27,972) $ (258,708)
============= =============
Class B Shares for the Year Dollar
Ended December 31, 1998 Shares Amount
Shares sold 52,086,564 $ 711,124,670
Shares issued to shareholders in
reinvestment of dividends and
distributions 11,614,251 154,732,397
------------- -------------
Total issued 63,700,815 865,857,067
Automatic conversion of shares (837,665) (11,201,223)
Shares redeemed (21,371,519) (284,576,009)
------------- -------------
Net increase 41,491,631 $ 570,079,835
============= =============
Class C Shares for the Six Months Dollar
Ended June 30, 1999 Shares Amount
Shares sold 3,256,821 $ 43,153,799
Shares redeemed (4,026,062) (53,345,204)
------------- -------------
Net decrease (769,241) $ (10,191,405)
============= =============
Class C Shares for the Year Dollar
Ended December 31, 1998 Shares Amount
Shares sold 10,104,124 $ 138,079,120
Shares issued to shareholders in
reinvestment of dividends and
distributions 2,149,018 28,640,687
------------- -------------
Total issued 12,253,142 166,719,807
Shares redeemed (4,761,365) (63,354,025)
------------- -------------
Net increase 7,491,777 $ 103,365,782
============= =============
Class D Shares for the Six Months Dollar
Ended June 30, 1999 Shares Amount
Shares sold 3,909,209 $ 52,176,177
Automatic conversion of shares 1,163,453 15,594,067
------------- -------------
Total issued 5,072,662 67,770,244
Shares redeemed (4,803,171) (63,975,877)
------------- -------------
Net increase 269,491 $ 3,794,367
============= =============
Class D Shares for the Year Dollar
Ended December 31, 1998 Shares Amount
Shares sold 12,280,913 $ 167,684,549
Automatic conversion of shares 832,238 11,201,223
Shares issued to shareholders in
reinvestment of dividends and
distributions 2,707,655 36,169,410
------------- -------------
Total issued 15,820,806 215,055,182
Shares redeemed (6,112,408) (81,204,015)
------------- -------------
Net increase 9,708,398 $ 133,851,167
============= =============
5. Subsequent Event:
On July 1, 1999, the Fund's Board of Directors declared an ordinary
income dividend to shareholders in the amount of $.108853 per Class
A Share, $.108711 per Class B Share, $.108717 per Class C Share,
$.108816 per Class D Share and a long-term capital gains
distribution in the amount of $.228601 per share for all four
classes, payable on July 15, 1999 to shareholders of record as of
July 7, 1999.
PORTFOLIO CHANGES
For the Quarter Ended June 30, 1999
Additions
The Chase Manhattan Corporation
The Goldman Sachs Group, Inc.
Deletions
Diageo PLC
McKesson HBOC, Inc.
Telecom Italia SpA
