MERRILL LYNCH
BASIC VALUE
FUND, INC.
FUND LOGO
Quarterly Report
March 31, 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
Basic Value Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
MERRILL LYNCH BASIC VALUE FUND, INC.
TO OUR SHAREHOLDERS
There were some conflicting signals regarding the future direction
of the US economy during the quarter ended March 31, 1999. However,
on balance the economic outlook continued to be positive. The US
economic expansion is ongoing, especially in the consumer sector.
Economic growth is not occurring at inflationary rates, although the
Organization for Petroleum Exporting Countries (OPEC) successfully
engineered a near-term increase in the price of crude oil. Against
this backdrop, the US Federal Reserve Board kept monetary policy on
hold. Outside of the United States, signs of growth are less
apparent in other major industrial economies, although the economic
outlook is improving in Europe. Although the crisis in Yugoslavia
has raised serious geopolitical concerns, it was not a significant
factor in the economic or investment outlook. In Japan, there are
not yet clear signs that Japan's economy is improving, and the
emerging economies remain tentative.
In the US capital markets, long-term interest rates have risen
somewhat thus far in 1999, but yield spreads between Treasury and
corporate issues remain wide. However, the major news was the Dow
Jones Industrial Average closing above the 10,000 level for the
first time; shortly after the end of the March quarter, other stock
market indexes reached record high levels. Nevertheless, the US
stock market's rise was very narrow in scope, with relatively few
large-capitalization issues accounting for the advance.
Portfolio Matters
Security purchases during the first quarter of 1999 amounted to $302
million while security sales were $656 million. On the buy side, we
initiated one new position and added to 14 existing holdings. On the
sell side, we eliminated three positions and reduced holdings in 21
commitments.
The new addition to the portfolio was Duke Energy Corporation, an
electric utility with significant operations in natural gas
transmission and energy services. The current company was formed in
mid-1997 through the merger of Duke Power and PanEnergy. We believe
long-term growth prospects are favorable while at the same time, the
stock offers attractive defensive characteristics and a generous
yield.
The major additions to established positions included International
Business Machines Corporation (IBM), U S West, Inc., Ameritech
Corporation, National City Corporation and American General
Corporation. IBM experienced some price weakness during the quarter,
and we considered this an opportunity to add to our largest
position. We are optimistic on telecommunications and increased our
already extensive exposure by adding to U S West and Ameritech. We
continued to build the National City position and American General
was both bought and sold during the quarter, continuing the practice
of trading around core positions.
On the sell side, we eliminated Merck & Co., Inc., Occidental
Petroleum Corporation and Summit Properties Inc. We had been scaling
back on the Merck position for a considerable period of time and
sold the final portion during the March quarter. The stock was
originally purchased in 1993 when drug stocks were decidedly out-of-
favor and selling at attractive valuations. With a definite return
to popularity, and substantially higher valuations, profit taking
seemed prudent. Occidental Petroleum never fulfilled our
expectations and was sold at a loss. Also, we felt the stock was a
redundant holding among our extensive energy positions. Summit
Properties was one of our smallest positons.
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
The five largest partial sales were The Seagram Company Ltd.,
Citigroup Inc., Applied Materials, Inc., Bristol-Myers Squibb
Company and Texas Instruments Incorporated. Substantial profits were
secured in each, and Citigroup Inc. remains our second-largest
holding. Overall security sales in the quarter generated profits of
over $242 million, or more than 50%.
In Conclusion
The disparity between valuations and market performance of "growth"
and "value" continues. Powering most of the market gains, however,
are barely 30--40 of the largest-capitalization growth stocks.
Market breadth (advancing stocks compared with declining stocks)
remains extremely narrow, and daily new highs seldom exceed daily
new lows, a highly unusual occurrence in a very strong market
environment.
There are some early, but not yet definitive, indications of a shift
in market emphasis. As always, we continue to adhere to a strict
value discipline, and as contrarians and out-of-favor investors,
think it is an appropriate time for investors to stress "value" and
not to chase "growth."
Thank you for your investment in Merrill Lynch Basic Value Fund,
Inc. We look forward to reviewing our outlook and strategy in our
upcoming annual report to shareholders.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Director
(Paul M. Hoffmann)
Paul M. Hoffmann
Senior Vice President and Portfolio Manager
May 4, 1999
After more than 20 years of service, Arthur Zeikel recently retired
as Chairman of Merrill Lynch Asset Management, L.P. (MLAM). Mr.
Zeikel served as President of MLAM from 1977 to 1997 and as Chairman
since December 1997. Mr. Zeikel is one of the country's most
respected leaders in asset management and presided over the growth
of Merrill Lynch's asset management business. During his tenure,
client assets under management grew from $300 million to over $500
billion. Mr. Zeikel will remain on Merrill Lynch Basic Value Fund,
Inc.'s Board of Directors. We are pleased to announce that Terry K.
Glenn has been elected President and Director of the Fund. Mr. Glenn
has held the position of Executive Vice President of MLAM since
1983.
Mr. Zeikel's colleagues at MLAM join the Fund's Board of Directors
in wishing him well in his retirement from Merrill Lynch and are
pleased that he will continue as a member of the Fund's Board of
Directors.
Merrill Lynch Basic Value Fund, Inc.
March 31, 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.
Average Annual Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 3/31/99 + 1.53% - 3.80%
Five Years Ended 3/31/99 +18.99 +17.71
Ten Years Ended 3/31/99 +14.49 +13.88
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 3/31/99 + 0.52% - 3.22%
Five Years Ended 3/31/99 +17.78 +17.78
Ten Years Ended 3/31/99 +13.33 +13.33
[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 3/31/99 + 0.50% - 0.43%
Inception (10/21/94)
through 3/31/99 +18.91 +18.91
[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 3/31/99 + 1.29% - 4.03%
Inception (10/21/94)
through 3/31/99 +19.84 +18.40
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
PERFORMANCE DATA (concluded)
Results of a $1,000 Investment Since Inception--Class A Shares
(5.25% current sales charge--$947.50 net amount invested; assuming
reinvestment of all dividends and capital gains distributions)
A mountain chart depicting the growth of an investment in the Fund's
Class A Shares from $947.50 on July 1, 1977 to $24,692.80 on March 31, 1999.
<TABLE>
Recent Performance Results
<CAPTION>
Ten Years/
12 Month 3 Month Since Inception
Total Return Total Return Total Return
<S> <C> <C> <C>
ML Basic Value Fund Class A Shares* + 1.53% +1.39% +287.02%
ML Basic Value Fund Class B Shares* + 0.52 +1.17 +249.57
ML Basic Value Fund Class C Shares* + 0.50 +1.16 +115.76
ML Basic Value Fund Class D Shares* + 1.29 +1.37 +123.42
Dow Jones Industrial Average** +13.13 +7.01 +462.68/+177.00
Standard & Poor's 500 Index** +18.46 +4.98 +468.23/+202.75
<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 ten-year/since inception periods are Class A & Class B
Shares, for the ten years ended 3/31/99 and Class C & Class D
Shares, from 10/21/94 to 3/31/99.
**An unmanaged broad-based index comprised of common stocks. Ten
years/since inception total returns are for the ten years ended
3/31/99 and from 10/21/94 to 3/31/99, respectively.
</TABLE>
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS
<CAPTION>
Shares Percent of
Industry Held Stocks Cost Value Net Assets
Low Price to Book Value
<S> <C> <S> <C> <C> <C>
Metals/Non-Ferrous 1,400,000 ASARCO Incorporated $ 36,667,971 $ 19,250,000 0.2%
Insurance 2,500,000 American General Corporation 65,307,992 176,250,000 1.5
Insurance 260,000 American National Insurance Company 9,749,442 17,290,000 0.1
Steel 4,500,000 Bethlehem Steel Corporation 56,745,956 37,125,000 0.3
Aerospace 4,100,000 The Boeing Company 138,309,307 139,912,500 1.2
Restaurants 3,900,000 Darden Restaurants, Inc. 36,505,673 80,437,500 0.7
Information Processing 1,700,000 Data General Corporation 23,665,586 17,212,500 0.1
Oil Services & Equipment 4,300,000 Diamond Offshore Drilling, Inc. 179,184,079 135,987,500 1.1
Retail 3,150,000 Federated Department Stores, Inc. 100,477,801 126,393,750 1.1
Capital Goods 2,800,000 Fluor Corporation 143,609,761 75,600,000 0.6
Automotive 4,600,000 Ford Motor Company 91,435,351 261,050,000 2.2
Automotive 2,600,000 General Motors Corporation 114,646,840 225,875,000 1.9
Insurance 2,500,000 The Hartford Financial Services
Group, Inc. 31,155,644 142,031,250 1.2
Chemicals 1,200,000 Imperial Chemical Industries PLC
(ADR)* 66,336,804 42,975,000 0.3
Paper & Forest Products 1,650,000 International Paper Company 64,190,553 69,609,375 0.6
Retail 6,000,000 Kmart Corporation 72,061,012 100,875,000 0.8
Insurance 1,400,000 PartnerRe Ltd. 29,498,937 56,700,000 0.5
Beverages 400,000 The Seagram Company Ltd. 13,814,290 20,000,000 0.2
Electronics 2,400,000 Tektronix, Inc. 62,202,224 60,600,000 0.5
Steel 3,000,000 USX-U.S. Steel Group 90,807,536 70,500,000 0.6
Chemicals 2,300,000 Union Carbide Corporation 80,302,379 103,931,250 0.9
Railroads 4,450,000 Union Pacific Corporation 200,466,281 237,796,875 2.0
Retail 4,000,000 Venator Group, Inc. 55,901,671 28,250,000 0.2
Banking 9,600,000 Wells Fargo Company 152,700,107 336,600,000 2.8
-------------- --------------- ------
1,915,743,197 2,582,252,500 21.6
Below-Average Price/Earnings Ratio
Insurance 5,000,000 The Allstate Corporation 58,084,911 185,312,500 1.6
Banking 2,600,000 BankAmerica Corporation 73,705,440 183,625,000 1.5
Farm & Construction
Equipment 4,000,000 Caterpillar Inc. 216,034,335 183,750,000 1.6
Banking 7,000,000 Citigroup Inc. 132,436,364 447,125,000 3.7
Farm & Construction
Equipment 5,000,000 Deere & Company 127,302,509 193,125,000 1.6
Photography 1,800,000 Eastman Kodak Company 106,085,437 114,975,000 1.0
Capital Goods 2,000,000 Eaton Corporation 119,193,864 143,000,000 1.2
Chemicals 2,800,000 Hercules Incorporated 75,478,956 70,700,000 0.6
Machinery 3,400,000 ITT Industries, Inc. 73,244,970 120,275,000 1.0
Machinery 3,400,000 Ingersoll-Rand Company 81,394,469 168,725,000 1.4
Electrical Equipment 3,300,000 Koninklijke (Royal) Philips Electronics
NV (NY Registered Shares) 99,890,293 272,043,750 2.3
Tobacco 3,600,000 Philip Morris Companies Inc. 121,046,095 126,675,000 1.1
Fertilizers 1,600,000 Potash Corporation of Saskatchewan Inc. 125,426,223 85,600,000 0.7
Retail 4,000,000 Sears, Roebuck & Co. 123,523,136 180,750,000 1.5
Electrical Equipment 2,000,000 Thomas & Betts Corporation 94,512,198 75,125,000 0.6
Savings & Loans 2,520,000 Washington Mutual, Inc. 35,180,899 103,005,000 0.9
-------------- --------------- ------
1,662,540,099 2,653,811,250 22.3
</TABLE>
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Shares Percent of
Industry Held Stocks Cost Value Net Assets
Above-Average Yield
<S> <C> <S> <C> <C> <C>
Telecommunications 4,300,000 Ameritech Corporation $ 149,083,661 $ 248,862,500 2.1%
Oil--Domestic 2,300,000 Atlantic Richfield Company (ARCO) 130,818,339 167,900,000 1.4
Oil--International 1,982,000 BP Amoco PLC (ADR)* 71,033,241 200,058,125 1.7
Telecommunications 2,900,000 Bell Atlantic Corporation 78,567,640 149,893,750 1.3
Utilities--Electric 2,000,000 CINergy Corp. 56,772,786 55,000,000 0.5
Oil--International 2,485,000 Chevron Corporation 118,657,052 219,767,187 1.8
Utilities--Electric 1,550,000 Consolidated Edison, Inc. 36,876,249 70,234,375 0.6
Utilities--Electric 956,250 DPL Inc. 6,204,369 15,778,125 0.1
Utilities--Electric 2,000,000 Duke Energy Corporation 126,763,702 109,250,000 0.9
Chemicals 3,880,000 E.I. du Pont de Nemours and Company 174,918,406 225,282,500 1.9
Utilities--Electric 3,000,000 Entergy Corporation 69,641,133 82,500,000 0.7
Oil--International 4,400,000 Exxon Corporation 166,532,415 310,475,000 2.6
Telecommunications 3,300,000 GTE Corporation 109,572,500 199,650,000 1.7
Foods 1,900,000 General Mills, Inc. 97,543,255 143,568,750 1.2
Real Estate Investment Trust 440,000 Irvine Apartment Communities, Inc. 6,678,695 14,465,000 0.1
Real Estate Investment Trust 900,000 Liberty Property Trust 17,263,193 18,675,000 0.2
Real Estate Investment Trust 500,000 Mills Corp. 9,691,442 8,968,750 0.1
Oil--International 3,300,000 Mobil Corporation 116,734,293 290,400,000 2.4
Utilities--Electric 2,400,000 NIPSCO Industries, Inc. 27,387,777 64,800,000 0.5
Banking 2,000,000 National City Corporation 133,497,230 132,750,000 1.1
Utilities--Electric 2,400,000 PECO Energy Company 56,812,882 111,000,000 0.9
Utilities--Electric 1,800,000 Public Service Enterprise Group
Incorporated 48,476,636 68,737,500 0.6
Oil--International 5,000,000 Royal Dutch Petroleum Company (NY
Registered Shares) 141,376,283 260,000,000 2.2
Real Estate Investment Trust 2,100,000 Simon Property Group, Inc. 43,206,889 57,618,750 0.5
Oil--International 3,000,000 Texaco Inc. 119,801,943 170,250,000 1.4
Utilities--Electric 2,900,000 Texas Utilities Company 103,140,138 120,893,750 1.0
Telecommunications 3,400,000 U S West, Inc. 99,578,668 187,212,500 1.6
-------------- --------------- ------
2,316,630,817 3,703,991,562 31.1
Special Situations
Telecommunications 2,800,000 AT&T Corp. 100,871,726 223,475,000 1.9
Semiconductors 3,300,000 Applied Materials, Inc. 110,780,315 203,568,750 1.7
Savings & Loans 3,250,000 Associates First Capital Corporation
(Class A) 73,717,602 146,250,000 1.2
Pharmaceuticals 1,320,000 AstraZeneca Group PLC (ADR)* 12,980,000 62,122,500 0.5
Pharmaceuticals 1,600,000 Bristol-Myers Squibb Company 22,190,270 102,900,000 0.9
Oil Services & Equipment 3,900,000 Halliburton Company 95,226,334 150,150,000 1.2
Information Processing 2,700,000 Hewlett-Packard Company 157,412,194 183,093,750 1.5
Information Processing 3,000,000 International Business Machines
Corporation 145,151,024 531,750,000 4.5
Telecommunications 1,632,000 Telefonica SA (ADR)* 63,336,735 208,488,000 1.7
Semiconductors 1,200,000 Texas Instruments Incorporated 54,073,974 119,100,000 1.0
Information Processing 5,000,000 Unisys Corporation 53,702,547 138,437,500 1.2
-------------- --------------- ------
889,442,721 2,069,335,500 17.3
Total Stocks 6,784,356,834 11,009,390,812 92.3
</TABLE>
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Face Percent of
Amount Issue Cost Value Net Assets
Short-Term Securities
<S> <C> <S> <C> <C> <C>
Commercial Paper** $ 50,000,000 AT&T Corp., 4.82% due 4/15/1999 $ 49,899,583 $ 49,899,583 0.4%
11,266,000 American Home Products, Inc., 4.85%
due 4/28/1999 11,223,502 11,223,502 0.1
25,000,000 Block Financial Corp., 4.84% due
4/16/1999 24,946,222 24,946,222 0.2
CSW Credit Inc.:
18,550,000 4.85% due 4/05/1999 18,537,504 18,537,504 0.2
17,235,000 4.85% due 4/27/1999 17,172,308 17,172,308 0.1
10,974,000 4.83% due 5/14/1999 10,909,217 10,909,217 0.1
45,000,000 E.I. du Pont de Nemours and Company,
4.83% due 4/23/1999 44,861,138 44,861,138 0.4
24,750,000 Finova Capital Corp., 4.87% due
4/09/1999 24,719,867 24,719,867 0.2
50,000,000 Ford Motor Credit Company, 4.84% due
4/19/1999 49,872,278 49,872,278 0.4
25,000,000 Formosa Plastics Corporation, 4.83%
due 4/08/1999 24,973,167 24,973,167 0.2
General Electric Capital Corp.:
32,329,000 5.08% due 4/01/1999 32,324,438 32,324,438 0.3
40,000,000 4.84% due 4/30/1999 39,838,667 39,838,667 0.3
24,800,000 H.J. Heinz Company, 4.83% due 4/26/1999 24,713,489 24,713,489 0.2
30,000,000 Lucent Technologies Inc., 4.80% due
4/05/1999 29,980,000 29,980,000 0.2
Metropolitan Life Insurance Company:
20,000,000 4.84% due 4/14/1999 19,962,356 19,962,356 0.2
10,000,000 4.84% due 4/27/1999 9,963,700 9,963,700 0.1
30,119,000 4.84% due 4/28/1999 30,005,619 30,005,619 0.3
35,000,000 Morgan Stanley, Dean Witter, Discover
& Co., 4.87% due 4/21/1999 34,900,571 34,900,571 0.3
10,000,000 Newell Rubbermaid Inc., 4.85% due
4/23/1999 9,969,014 9,969,014 0.1
29,479,000 Pfizer Inc., 4.84% due 4/01/1999 29,475,037 29,475,037 0.2
33,100,000 Toys 'R' Us, Inc., 4.84% due 4/07/1999 33,068,849 33,068,849 0.3
20,000,000 Transamerica Finance Corporation,
4.80% due 4/07/1999 19,981,333 19,981,333 0.2
Xerox Capital (Europe) PLC:
36,562,000 4.82% due 5/06/1999 36,385,771 36,385,771 0.3
18,587,000 4.82% due 5/07/1999 18,494,922 18,494,922 0.2
Xerox Credit Corp.:
17,779,000 4.82% due 4/29/1999 17,709,968 17,709,968 0.1
25,000,000 4.81% due 5/07/1999 24,876,410 24,876,410 0.2
-------------- --------------- ------
688,764,930 688,764,930 5.8
</TABLE>
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (concluded)
<CAPTION>
Face Percent of
Amount Issue Cost Value Net Assets
Short-Term Securities (concluded)
<S> <C> <S> <C> <C> <C>
US Government Agency Federal Home Loan Mortgage
Obligations** Corporation:
$28,548,000 4.78% due 4/09/1999 $ 28,513,885 $ 28,513,885 0.3%
49,224,000 4.78% due 4/12/1999 49,145,570 49,145,570 0.4
30,935,000 4.78% due 4/14/1999 30,877,495 30,877,495 0.3
26,886,000 4.74% due 4/26/1999 26,793,960 26,793,960 0.2
36,997,000 4.73% due 5/17/1999 36,768,533 36,768,533 0.3
-------------- --------------- ------
172,099,443 172,099,443 1.5
Repurchase Agreements*** 50,000,000 CIT Group Holdings, Inc., purchased
on 3/31/1999 to yield 4.84% to
4/13/1999 49,912,611 49,912,611 0.4
Total Short-Term Securities 910,776,984 910,776,984 7.7
Total Investments $7,695,133,818 11,920,167,796 100.0
==============
Other Assets Less Liabilities 3,957,576 0.0
--------------- ------
Net Assets $11,924,125,372 100.0%
=============== ======
Net Asset Value: Class A--Based on net assets of $5,220,648,033 and
135,420,493 shares outstanding $ 38.55
===============
Class B--Based on net assets of $4,484,782,047 and
118,377,295 shares outstanding $ 37.89
===============
Class C--Based on net assets of $477,594,025 and
12,745,308 shares outstanding $ 37.47
===============
Class D--Based on net assets of $1,741,101,267 and
45,286,498 shares outstanding $ 38.45
===============
<FN>
*American Depositary Receipts (ADR).
**Commercial Paper and certain US Government Agency Obligations are
traded on a discount basis; the interest rates shown reflect the
discount rates paid at the time of purchase by the Fund.
***Repurchase Agreements are fully collateralized by US Government
Agency Obligations.
</TABLE>
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
PORTFOLIO INFORMATION
As of March 31, 1999
Percent of
Ten Largest Stock Holdings Net Assets
International Business Machines
Corporation 4.5%
Citigroup Inc. 3.7
Wells Fargo Company 2.8
Exxon Corporation 2.6
Mobil Corporation 2.4
Koninklijke (Royal) Philips Electronics NV
(NY Registered Shares) 2.3
Ford Motor Company 2.2
Royal Dutch Petroleum Company
(NY Registered Shares) 2.2
Ameritech Corporation 2.1
Union Pacific Corporation 2.0
Portfolio Changes for the Quarter
Ended March 31, 1999
Additions
Duke Energy Corporation
Deletions
Merck & Co., Inc.
Occidental Petroleum Corporation
Summit Properties Inc.
Merrill Lynch Basic Value Fund, Inc.
March 31, 1999
OFFICERS AND DIRECTORS
Terry K. Glenn, President and Director
Donald Cecil, Director
M. Colyer Crum, Director
Edward H. Meyer, Director
Jack B. Sunderland, Director
J. Thomas Touchton, Director
Fred G. Weiss, Director
Arthur Zeikel, Director
Paul M. Hoffmann, Senior Vice President
and Portfolio Manager
Donald C. Burke, Vice President and Treasurer
Thomas D. Jones, III, Secretary
Gerald M. Richard, Treasurer and Norman R. Harvey, Senior Vice
President of Merrill Lynch Basic Value Fund, Inc. have recently
retired. Their colleagues at Merrill Lynch Asset Management, L.P.
join the Fund's Board of Directors in wishing Mr. Richard and Mr.
Harvey well in their retirements.
Custodian
The Bank of New York
90 Washington Street, 12th Floor
New York, NY 10286
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
