FIDELITY INVESTMENT TRUST, N-30D, 1997-12-23

FIDELITY INVESTMENT TRUST
N-30D, 1997-12-23

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(2_FIDELITY_LOGOS)FIDELITY'S
BROADLY DIVERSIFIED INTERNATIONAL EQUITY
FUNDS
FIDELITY INTERNATIONAL GROWTH & INCOME FUND
FIDELITY DIVERSIFIED INTERNATIONAL FUND
FIDELITY INTERNATIONAL VALUE FUND
FIDELITY OVERSEAS FUND
FIDELITY WORLDWIDE FUND

ANNUAL REPORT
FOR THE YEAR ENDING
OCTOBER 31, 1997
AND
PROSPECTUS
DATED DECEMBER 30, 1997
CONTENTS

<TABLE>
<CAPTION>
<S> <C> <C>
MARKET RECAP A-3 A REVIEW OF WHAT HAPPENED IN WORLD MARKETS
DURING THE LAST SIX MONTHS.

FAIR-VALUE PRICING: HOW AND WHY A-4

INTERNATIONAL GROWTH & INCOME FUND A-5 PERFORMANCE
A-6 FUND TALK: THE MANAGER'S OVERVIEW
A-8 INVESTMENT CHANGES
A-9 INVESTMENTS
A-15 FINANCIAL STATEMENTS

DIVERSIFIED INTERNATIONAL FUND A-17 PERFORMANCE
A-18 FUND TALK: THE MANAGER'S OVERVIEW
A-20 INVESTMENT CHANGES
A-21 INVESTMENTS
A-28 FINANCIAL STATEMENTS

INTERNATIONAL VALUE FUND A-30 PERFORMANCE
A-31 FUND TALK: THE MANAGER'S OVERVIEW
A-33 INVESTMENT CHANGES
A-34 INVESTMENTS
A-39 FINANCIAL STATEMENTS

OVERSEAS FUND A-41 PERFORMANCE
A-42 FUND TALK: THE MANAGER'S OVERVIEW
A-44 INVESTMENT CHANGES
A-45 INVESTMENTS
A-50 FINANCIAL STATEMENTS

WORLDWIDE FUND A-52 PERFORMANCE
A-53 FUND TALK: THE MANAGER'S OVERVIEW
A-55 INVESTMENT CHANGES
A-56 INVESTMENTS
A-59 FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS A-61 NOTES TO THE FINANCIAL STATEMENTS

REPORT OF INDEPENDENT ACCOUNTANTS A-64 THE AUDITORS' OPINION

DISTRIBUTIONS A-65

PROXY VOTING RESULTS A-66

FIDELITY'S BROADLY DIVERSIFIED P-1
INTERNATIONAL EQUITY
FUNDS PROSPECTUS

</TABLE>

To reduce expenses and demonstrate respect for our environment, we
have initiated a project through which we will begin eliminating
duplicate copies of most financial reports and prospectuses to most
households, even if they have more than one account in the fund. If
additional copies of financial reports, prospectuses or historical
account information are needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE
FUNDS. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE
INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR
MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL 1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE
YOU INVEST OR SEND MONEY.
MARKET RECAP

The 12-month period that ended October 31, 1997, displayed the marked
diversity of the world's financial markets. Most European markets -
riding the coattails of strong economies and a low interest-rate
environment - turned in positive performances. In stark contrast, some
Southeast Asian markets fell hard due to economic and currency
volatility in late October. For the period, the Morgan Stanley Capital
International (MSCI) Europe, Australasia and Far East Index returned
4.82%.
EUROPE: A favorable economic backdrop of low interest rates and scant
inflationary concerns equated to a solid performance period for most
European markets. Amid improving economies, many corporations
throughout Europe continued to preach a proactive mentality -
implementing various internal programs designed to cut costs and boost
share prices. For the most part, these restructurings were
well-received by investors. The MSCI Europe Index returned a healthy
26.30% during the period. Strong individual performers included
Finland, Italy, Spain and Ireland. While a strengthening U.S. dollar
took back some of their gains throughout most of the period, Germany
and France still performed capably.
EMERGING MARKETS: Similar to Europe, revitalized economies and a
favorable interest-rate climate spelled strong returns for many Latin
American markets, especially Brazil, Mexico and Argentina. Strong
investor inflows and beneficial political developments also figured
prominently. The MSCI Emerging Markets Free - Latin America Index
returned 24.05% during the period. Trouble began brewing in June,
however, as Brazil's currency dropped on fears that it was overvalued.
This triggered sell-offs in other Latin American markets, and returns
cooled during the final months of the period. The wider-ranging, more
problematic situation, though, occurred in Southeast Asia. As early as
late summer 1997, market followers had expressed concern that
currencies in this region were at unsustainably high levels. Many
cited real estate overbuilding in countries such as Thailand, Malaysia
and the Philippines as being major detriments. In late October, these
concerns became warranted. Currency devaluations spread like wildfire,
with much pressure being placed on Southeast Asia's banking
institutions. The MSCI Far East ex-Japan Free Index was down 34.59%
during the period. This crisis permeated world markets, including the
U.S., which experienced one of its largest one-day sell-offs ever.
JAPAN AND THE FAR EAST: Many market followers felt Japan - after a
prolonged phase of sluggish economic growth - would turn the corner
during the period. It didn't happen. Increased tax rates, continued
bankruptcies and difficulties associated with deregulation in several
key industries halted forward progress. The Tokyo Stock Exchange Index
- - a gauge of the Japanese market - was down 21.48% over the past 12
months. Despite a strong 11-month run, the Hong Kong market suffered
on the heels of the currency problems in Southeast Asia. In Hong Kong,
increasing short-term interest rates cut off short-term corporate
lending and the real estate industry - which had accounted for nearly
40% of total bank loans - was severely affected. The Hang Seng Index,
which measures the performance of the Hong Kong stock market, was down
12.53% for the period.
U.S. AND CANADA: Overall, the U.S. stock market registered a strong
performance during the period. The Standard & Poor's 500 Index - a
barometer of U.S. stock market performance - returned 32.11% over this
time, well ahead of its long-term annual average return of around 11%.
For much of the period, the market's surge was led by companies with
very large market capitalizations. In March, the Federal Reserve Board
raised a key short-term interest rate in a move designed to curb any
potential inflation uptick. At that point, the market paused to
collect its breath, then continued rolling through the summer months
as the Dow Jones Industrial Average reached the 8000-point mark for
the first time in its history. But market volatility was lurking in
the shadows. Disappointing corporate earnings brought blips of
volatility in July and August, and the crisis in Southeast Asia made
for a topsy-turvy October. The Dow went down 550-plus points in one
day, only to snap back 330-plus points the next. Canada's stock market
turned in relatively positive returns for the period, with financial
and utility stocks leading the way. For the 12 months that ended
October 31, 1997, the Toronto Stock Exchange 300 was up 18.18%.
BONDS: While bond markets generally lagged equity markets throughout
the world, there were pockets of strong performance. Led by a strong
dollar, U.S.-based bonds topped most foreign bonds. The United Kingdom
was also a strong performer, as the newly installed Labor party
established an independent central banking system. Brady bonds - bonds
issued by governments of developing countries that are denominated in
U.S. dollars - performed well, particularly in Latin American
countries such as Argentina and Brazil. The Southeast Asian problems
took back many gains, but the J.P. Morgan Emerging Markets Bond Index
still managed to return 14.00% for the period. The Salomon Brothers
Non-U.S. World Government Bond Index - a proxy for developed countries
- - was down 0.31% for the period.

S&P 500 EAFE
* YEAR TO DATE THROUGH OCTOBER 31, 1997.
Row: 1, Col: 1, Value: nil
Row: 1, Col: 2, Value: nil
Row: 2, Col: 1, Value: 6.1
Row: 2, Col: 2, Value: 7.38
Row: 3, Col: 1, Value: 31.57
Row: 3, Col: 2, Value: 56.16
Row: 4, Col: 1, Value: 18.56
Row: 4, Col: 2, Value: 69.44000000000001
Row: 5, Col: 1, Value: 5.1
Row: 5, Col: 2, Value: 24.63
Row: 6, Col: 1, Value: 16.61
Row: 6, Col: 2, Value: 28.27
Row: 7, Col: 1, Value: 31.69
Row: 7, Col: 2, Value: 10.53
Row: 8, Col: 1, Value: -3.1
Row: 8, Col: 2, Value: -23.45
Row: 9, Col: 1, Value: 30.47
Row: 9, Col: 2, Value: 12.13
Row: 10, Col: 1, Value: 7.619999999999999
Row: 10, Col: 2, Value: -12.17
Row: 11, Col: 1, Value: 10.08
Row: 11, Col: 2, Value: 32.56
Row: 12, Col: 1, Value: 1.32
Row: 12, Col: 2, Value: 7.78
Row: 13, Col: 1, Value: 37.58
Row: 13, Col: 2, Value: 11.21
Row: 14, Col: 1, Value: 22.96
Row: 14, Col: 2, Value: 6.05
Row: 15, Col: 1, Value: 32.11
Row: 15, Col: 2, Value: 4.819999999999999
%
FAIR-VALUE PRICING: HOW AND WHY

NOTE TO SHAREHOLDERS: RECENT VOLATILITY IN STOCK MARKETS AROUND THE
WORLD HAS DRAWN ATTENTION TO A PRACTICE EMPLOYED BY SOME MUTUAL FUND
COMPANIES CALLED "FAIR-VALUE" PRICING. FIDELITY HAS USED FAIR-VALUE
PRICING WHEN APPROPRIATE FOR MANY YEARS IN THE BELIEF THAT IT IS IN
THE BEST INTERESTS OF SHAREHOLDERS TO DO SO. THE FOLLOWING DISCUSSION
IS INTENDED TO HELP SHAREHOLDERS UNDERSTAND THE HOW AND WHY OF
FAIR-VALUE PRICING.
The daily net asset value of most mutual funds is calculated based on
the price of each security in the fund at the close of the New York
Stock Exchange, normally 4 p.m. Eastern time. Generally, the
calculation process is fairly routine. However, when markets are
volatile or major events occur, the prices of some securities might be
unavailable, unreliable or out of date. It is at these times that
Fidelity uses a special procedure to determine the fair value of a
security or, sometimes, of an entire market.
Fair-value pricing can be particularly important in the case of
foreign securities, whose closing prices may not reflect their true
value when major changes occur after foreign markets close. An example
from last October 28, the day after Wall Street's "blue Monday" market
crash, illustrates how fair-value pricing is important to assure that
all investors get a fair price.
Hong Kong ends its trading day 13 hours before the New York Stock
Exchange (NYSE) closes, and much can change during this time. When the
Hong Kong market closed at 3 a.m. Eastern time on October 28, it was
down 13.7%. But after traders at the Hong Kong Stock Exchange went
home to bed, trading in certain securities listed on the Hong Kong
exchange continued in other markets around the world. In this
"after-hours" trading, the prices of these securities rebounded
significantly. One company, Hong Kong Telecommunications (traded on
the NYSE as well as in Hong Kong) made back all of the morning's
losses during the U.S. trading day, and actually closed the day up as
of 4:00 p.m. in New York.
Rather than value Hong Kong securities at prices that were 13 hours
old - and far too low based on concrete evidence from later trading -
Fidelity took this later trading into account and priced Hong Kong
securities up about 10% on average from their 3:00 a.m. closing
prices. In fact, when the Hong Kong market reopened for trading a few
hours later, it was up about 14%.
Fair value pricing made sure that investors who were buying or selling
Fidelity funds that day got a true 4:00 p.m. price for their funds -
not an artificial price based on stale data from a computer file.
What's more, fair-value pricing also protected shareholders of
Fidelity funds owning Hong Kong securities by preventing aggressive
traders from buying in at an artificially low price - knowing that
Hong Kong securities had gone up - then selling immediately at a
profit the next day, rather like betting on a horse race after it is
run. The profit these in-and-out traders sought would have been at the
expense of investors who already owned shares in the fund - and who
took the investment risk over the 13-hour gap period.
Fidelity, like other fund companies, also uses fair-value pricing on
individual securities. For example, trading of a company's stock on
the NYSE might be halted for some reason prior to the 4 p.m. market
close. If this occurs, and the value of that security changes
materially, a determination must be made of what the price of the
security would be if the funds tried to buy or sell at 4 p.m. This is
done by obtaining as much information as possible - from Fidelity
analysts and portfolio managers, the bid/ask quotes of brokers and
off-exchange institutional trading - as to why the security halted
trading and the impact of the event. Based on this information, the
fair value of the security is determined.
Fair-value pricing is a practice that is disclosed in fund
prospectuses and supported by the Securities and Exchange Commission.
The SEC recently completed a review of funds that used fair-value
pricing during October's market volatility, and concluded that those
funds that used fair-value pricing better protected their shareholders
than those funds that did not.
As an investor in Fidelity's international funds, you should keep in
mind that you can only trade the funds once a day, as of the close of
the NYSE. The price you'll pay for your shares if you're buying - or
the price you'll receive if you're selling - will be based on your
fund's value as of the 4:00 p.m. NYSE close, which is not necessarily
the same as the close in foreign stock markets. In today's global
markets, prices can keep changing throughout U.S. trading hours - so
the price you get at 4 p.m. may not match what you would have gotten
if you'd been able to trade earlier in the day. But you can be
confident that the price of your fund will reflect all relevant
factors as of the close of the NYSE, when the fund is valued.
INTERNATIONAL GROWTH & INCOME
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Fidelity had not reimbursed certain fund
expenses, the past 10 year total returns would have been lower. Prior
to June 1, 1994, the fund imposed a 2% sales charge.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

INTERNATIONAL GROWTH & INCOME 13.17% 78.78% 146.28%

MORGAN STANLEY CAPITAL 4.82% 74.59% 91.25%
INTERNATIONAL EAFE INDEX

J.P. MORGAN GLOBAL 3.49% 44.29% 133.50%
GOVERNMENT BOND INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 82.99% 158.84%

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Morgan Stanley Capital International (MSCI) Europe, Australasia, Far
East (EAFE) Index - a market capitalization weighted, unmanaged index
of over 1,000 foreign stocks. You can also compare the fund's
performance to the J.P. Morgan Global Government Bond Index - a broad
measure of bond performance in developed countries including the
United States. To measure how the fund's performance stacked up
against its peers, you can compare it to the international funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Analytical Services, Inc. The past one
year average represents a peer group of 406 mutual funds. These
benchmarks include reinvested dividends and capital gains, if any, and
exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

INTERNATIONAL GROWTH & INCOME 13.17% 12.32% 9.43%

MORGAN STANLEY CAPITAL 4.82% 11.79% 6.70%
INTERNATIONAL EAFE INDEX

J.P. MORGAN GLOBAL 3.49% 7.61% 8.85%
GOVERNMENT BOND INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 12.67% 9.68%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19971031 19971124 115757 S00000000000001
Int'l Growth & Income MS EAFE Index (Net)
JP Global Bond Index
00305 MS001
JP002
1987/10/31 10000.00 10000.00
10000.00
1987/11/30 9740.88 10098.48
10258.60
1987/12/31 10347.65 10398.33
10607.15
1988/01/31 9981.87 10583.99
10661.36
1988/02/29 10434.28 11289.48
10759.26
1988/03/31 10886.69 11983.63
10844.33
1988/04/30 11175.46 12157.77
10793.95
1988/05/31 11031.07 11768.04
10677.90
1988/06/30 10905.94 11457.85
10582.76
1988/07/31 10905.94 11817.33
10500.66
1988/08/31 10366.90 11048.99
10426.20
1988/09/30 10742.30 11531.77
10685.96
1988/10/31 11367.98 12518.45
11106.75
1988/11/30 11570.12 13264.13
11204.97
1988/12/31 11544.22 13338.08
11137.51
1989/01/31 11759.64 13572.76
11027.30
1989/02/28 11798.80 13642.52
11009.16
1989/03/31 11798.80 13374.77
10915.93
1989/04/30 12092.55 13498.82
11095.72
1989/05/31 11749.85 12764.44
10975.75
1989/06/30 11789.01 12549.57
11225.34
1989/07/31 12905.25 14125.45
11672.32
1989/08/31 12729.00 13490.18
11326.95
1989/09/30 13238.16 14104.68
11506.11
1989/10/31 12601.71 13537.99
11654.08
1989/11/30 13071.70 14218.54
11757.82
1989/12/31 13751.61 14743.16
11895.07
1990/01/31 13513.83 14194.60
11717.62
1990/02/28 13038.27 13203.89
11591.07
1990/03/31 13028.36 11828.36
11519.90
1990/04/30 12998.64 11734.49
11474.82
1990/05/31 13840.78 13073.41
11841.72
1990/06/30 14276.71 12958.26
12055.98
1990/07/31 14940.51 13140.79
12410.16
1990/08/31 13662.44 11864.71
12313.42
1990/09/30 12344.74 10211.19
12428.61
1990/10/31 13583.18 11802.28
12919.73
1990/11/30 13276.05 11106.09
13147.14
1990/12/31 13307.75 11286.00
13293.42
1991/01/31 13778.64 11651.05
13594.98
1991/02/28 14556.63 12900.03
13608.24
1991/03/31 14034.55 12125.61
13157.33
1991/04/30 14249.53 12244.69
13342.21
1991/05/31 14229.05 12372.45
13353.66
1991/06/30 13543.19 11463.31
13175.36
1991/07/31 14014.08 12026.53
13453.90
1991/08/31 13962.90 11782.29
13733.51
1991/09/30 14413.31 12446.33
14234.27
1991/10/31 14321.18 12622.77
14374.92
1991/11/30 13921.95 12033.48
14609.02
1991/12/31 14377.40 12654.93
15347.28
1992/01/31 14356.67 12384.62
15046.67
1992/02/29 14377.40 11941.35
15002.86
1992/03/31 13910.94 11153.02
14864.33
1992/04/30 14522.52 11206.04
14988.01
1992/05/31 15175.57 11956.12
15413.68
1992/06/30 15030.45 11389.02
15834.04
1992/07/31 14543.25 11097.54
16182.91
1992/08/31 14802.40 11793.58
16613.45
1992/09/30 14553.62 11560.69
16597.33
1992/10/31 13776.18 10954.28
16182.80
1992/11/30 13745.09 11057.36
15895.88
1992/12/31 13897.06 11114.55
16046.08
1993/01/31 14024.46 11113.19
16318.15
1993/02/28 14406.66 11448.88
16581.10
1993/03/31 15478.93 12446.83
16835.89
1993/04/30 16338.87 13628.07
17142.43
1993/05/31 16721.07 13915.89
17256.78
1993/06/30 16498.12 13698.78
17265.69
1993/07/31 17050.18 14178.30
17272.69
1993/08/31 17941.97 14943.69
17783.95
1993/09/30 17825.19 14607.31
17972.02
1993/10/31 18313.55 15057.48
17962.79
1993/11/30 17687.17 13741.30
17831.69
1993/12/31 18772.16 14733.52
18014.34
1994/01/31 19755.10 15979.17
18184.27
1994/02/28 19402.53 15934.91
17984.53
1994/03/31 18366.16 15248.57
17902.12
1994/04/30 18611.89 15895.55
17887.80
1994/05/31 18953.79 15804.29
17739.93
1994/06/30 18494.37 16027.64
17950.59
1994/07/31 18804.21 16181.78
18119.56
1994/08/31 18985.84 16564.88
18073.00
1994/09/30 18547.79 16043.16
18162.31
1994/10/31 18740.10 16577.40
18433.96
1994/11/30 18163.16 15780.69
18201.98
1994/12/31 18233.15 15879.50
18244.30
1995/01/31 17615.45 15269.48
18613.33
1995/02/28 17736.78 15225.66
19093.30
1995/03/31 18751.57 16175.30
20064.49
1995/04/30 19093.51 16783.63
20384.40
1995/05/31 18850.85 16583.56
20953.05
1995/06/30 18894.97 16292.74
21083.95
1995/07/31 20009.03 17307.06
21183.97
1995/08/31 19777.39 16646.86
20595.17
1995/09/30 19920.79 16971.98
21059.23
1995/10/31 19667.09 16515.77
21264.90
1995/11/30 19964.91 16975.30
21501.97
1995/12/31 20463.49 17659.24
21768.21
1996/01/31 20520.50 17731.73
21544.83
1996/02/29 20474.89 17791.68
21419.24
1996/03/31 20816.90 18169.50
21386.25
1996/04/30 21341.32 18697.75
21307.12
1996/05/31 21364.12 18353.68
21328.86
1996/06/30 21512.32 18456.98
21515.34
1996/07/31 21010.71 17917.53
21911.30
1996/08/31 21272.91 17956.79
22002.52
1996/09/30 21785.93 18433.82
22123.76
1996/10/31 21763.13 18245.19
22562.69
1996/11/30 22846.15 18971.14
22884.62
1996/12/31 23059.71 18727.09
22734.95
1997/01/31 22882.78 18075.39
22157.07
1997/02/28 23154.07 18375.44
22003.90
1997/03/31 23154.07 18445.27
21836.52
1997/04/30 23177.66 18546.72
21713.59
1997/05/31 24333.59 19757.26
22226.02
1997/06/30 25406.96 20849.84
22478.68
1997/07/31 26055.70 21190.11
22396.05
1997/08/31 24486.93 19610.39
22368.47
1997/09/30 26055.70 20711.91
22865.10
1997/10/31 24628.47 19125.17
23349.74
IMATRL PRASUN SHR__CHT 19971031 19971124 115801 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity International Growth & Income Fund on October 31,
1987. As the chart shows, by October 31, 1997, the value of the
investment would have grown to $24,628 - a 146.28% increase on the
initial investment. For comparison, look at how both the Morgan
Stanley Capital International EAFE Index and the J.P. Morgan Global
Government Bond Index did over the same period. With dividends and
capital gains, if any, reinvested in each, the same $10,000 would have
grown to $19,125 - a 91.25% increase and $23,350 - a 133.50% increase,
respectively.

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the
potential for significant growth over time;
however, investing in foreign markets means
assuming greater risks than investing in the
United States. Factors like changes in a
country's financial markets, its local political
and economic climate, and the fluctuating value
of its currency create these risks. For these
reasons an international fund's performance
may be more volatile than a fund that invests
exclusively in the United States. Past
performance is no guarantee of future results
and you may have a gain or loss when you sell
your shares.
(checkmark)
INTERNATIONAL GROWTH & INCOME
FUND TALK: THE MANAGER'S OVERVIEW

An interview with John Hickling, Portfolio Manager of
Fidelity International Growth & Income Fund
Q. JOHN, HOW DID THE FUND PERFORM?
A. Very well. For the 12-month period that ended October 31, 1997, the
fund posted a return of 13.17%. By comparison, the international funds
average, as tracked by Lipper Analytical Services, was up 10.39% over
the same period. Because the fund invests in both equities and bonds,
we compare it to two separate indexes to evaluate its performance. The
Morgan Stanley Capital International Europe, Australasia, Far East
(EAFE) Index - which measures equity returns - was up 4.82% over the
12-month period. For the same period, the J.P. Morgan Global
Government Bond Index - which tracks the performance of government
bonds in 13 developed countries including the U.S. - returned 3.49%.
As I noted in my shareholder report six months ago, given that this
fund competes against two very different indexes and beat them both, I
am quite pleased with this period's results.
Q. WHAT'S BEHIND THE FUND'S OUTPERFORMANCE OF THE EQUITY INDEX?
A. There were a number of reasons the fund outperformed its equity
index. Perhaps the most notable was that the fund was underweighted
compared to the index in Japan, where the overall equity market did
very poorly. In addition, my stock selection in Japan was very good.
The fund owned mostly export companies in the technology and auto
sectors. Many of these companies not only outperformed the Japanese
market, but beat other international markets as well. Good examples in
the fund's top 10 holdings were Honda and Sony. These companies were
more affected by the global economy than the local economy, and they
benefited greatly from the weak yen. Some of the larger Japanese
exporters also benefited on a currency translation basis from segments
of their business that were set up outside Japan. For example, Honda,
which actually produces more cars in the U.S. than in Japan, was able
to translate its strong U.S.- generated dollar profits into an even
larger amount of yen, since the Japanese currency was so weak. Another
reason the fund outperformed the index was that it was very
underweighted versus the index in Hong Kong when that market tumbled
dramatically in October. In addition, the fund had almost no holdings
in Southeast Asia, a strategy that certainly turned out to be right.
And finally, good stock selection in Europe continued to play a key
role in the fund's strong performance.
Q. WHY DID THE FUND ALSO LOOK STRONG AGAINST THE BOND INDEX?
A. Before I address this, I would like to remind shareholders that
over the period bond markets underperformed equity markets nearly
everywhere in the world. Even in Japan, where the stock market
performed very poorly, the bond market did even worse as measured in
dollars. However, I should note that as with the equity market, the
fund was underweighted in the Japanese bond market compared to the
index. What gave the fund a boost, in Japan as well as other
countries, was its investment in convertible bonds, which returned 21%
over the period. These bonds, like convertible preferred stocks, are
convertible into a fixed number of shares of a company's common stock.
So, when you buy convertible bonds, you are investing in a company,
not a country. In general, I'm much more comfortable with this
bottom-up approach - investing on a company-by-company basis, instead
of focusing on a top-down approach that looks at an entire country's
economy.
Q. DID ANY COUNTRIES' BOND MARKETS LOOK STRONG?
A. Yes. Fund performance was boosted by my investment in a fairly
large bond position in the United Kingdom, where the Labor party
recently established an independent central bank. The U.K. bond market
was cheap and oversold, and the pound sterling had strengthened, both
of which helped this bond market. The fund also benefited - mostly
from a currency standpoint - from a reasonably large bond holding in
the United States. Because the dollar was strong against most world
currencies, U.S.-based bonds outperformed most foreign bonds when the
returns from foreign bonds were converted from local currencies back
into dollars.
Q. THE FUND OUTPERFORMED ITS PEER GROUP OF INTERNATIONAL FUNDS.
CONSIDERING THAT FUNDS IN THIS GROUP DO NOT INVEST IN BONDS AND THAT
THIS FUND DOES - AND GIVEN A BOND MARKET THAT WAS MUCH WEAKER THAN THE
EQUITY MARKET - THE FUND'S OUTPERFORMANCE SEEMS PRETTY REMARKABLE . .
.
A. Remember, this is a balanced fund that normally has at least 25% of
its assets invested in bonds. And while this proved to be somewhat of
a handicap for the first 11 months of the period, bonds protected the
fund in October when the volatility of the Asian markets negatively
impacted markets all over the world. In fact, the fund outperformed
92% of its competitive universe in October.
Q. WHERE THERE ANY NEW STORIES BEHIND THE FUND'S TOP 10 EQUITY
HOLDINGS?
A. Not really. Generally, I stayed with some of the large European
stocks I owned six months ago, which continued to be excellent
performers. European restructuring stories - such as French oil
company Nationale Elf Aquitaine and French defense electronics company
Alcatel Alsthom - continued to turn in very strong performances and
improve shareholder value. Also, as I mentioned, the Japanese
exporters included in the top 10 holdings continued to do well. I
should note that I did see an improving situation for several U.K. and
French banks because the industry was changing and consolidating very
rapidly, and stocks were fairly inexpensive. One of the fund's largest
holdings, Societe Generale, was a good example of a bank that
benefited from these trends.
Q. DO YOU HAVE ANY REGRETS OVER THE PERIOD?
A. Sure. I wish I had owned Latin American Brady bonds -
dollar-denominated bonds of developing countries that are backed by
U.S. Treasury securities - in Argentina and Brazil for at least part
of period. They performed pretty well, with the exception of this
October when Latin American markets were negatively affected by the
volatility in Southeast Asia. In addition, I wish I had not held any
Japanese financial stocks over the period. I thought some of these
companies would perform better than what turned out to be a lousy
sector, but they didn't.
Q. JOHN, HOW DOES THE FUND LOOK GOING FORWARD?
A. I've been pleased with the fund's balanced strategy. The fund
performed well when the market was up, and it was strong - much
stronger than most of its competitors, as I mentioned - when worldwide
markets were volatile in October. I think this performance points to
the positive aspects of diversification because the fund can perform
well in good markets, and yet still retain some defensive and
diversified characteristics in volatile markets. Going forward, I
think markets are at an interesting point throughout Asia and in
Japan, and I will be looking for some opportunities there. As for the
U.K., I believe it looks extremely attractive from a stock market
standpoint because I think interest rates will decline and its
currency will be less strong. Both of these factors are very good for
the equity market. In terms of Europe, there may be a short-term
correction, but I believe that the restructuring many companies
undertook over the past year will have positive long-term results. So,
I think the outlook for Europe is quite good. Finally, I think events
in Asia will lead to lower interest rates around the world, which I
believe will be supportive of bond markets.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

JOHN HICKLING ON OCTOBER'S MARKET VOLATILITY IN
SOUTHEAST ASIA:
"While the fund had very little invested in Southeast Asian
markets over the period, the volatility of those markets this
October affected the fund in more general ways.
"The drop in Southeast Asia had a significantly negative
impact on the U.S. stock market. It hit U.S. companies that
had investments in Southeast Asia, where currencies fell hard
against the dollar. In addition, the market fluctuations in
Southeast Asia caused interest rates to shoot up across the
region, hurting not only the U.S. but world markets as well.
"The volatility also had a ripple effect in other emerging
markets around the world. For example, Brazil was one of
the worst-performing markets this October, but that really
didn't have much to do with the fundamentals of Brazilian
stocks. To illustrate, Brazilian utility Telebras, one of the
country's strongest companies, was incredibly volatile and
was hurt notably in October. Basically, investors were
concerned that Latin America would be the next Asia.
"I should point out that the fund's investments in
emerging markets, such as Brazil, paid off nicely for 11 1/2
out of the past 12 months. Over the period, I had about 8% of
the fund invested in emerging markets, in convertible
bonds and equities."

FUND FACTS
GOAL: growth of capital and current income by
investing mainly in foreign stocks and bonds
FUND NUMBER: 305
TRADING SYMBOL: FIGRX
START DATE: December 31, 1986
SIZE: as of October 31, 1997, more than
$1.0 billion
MANAGER: John Hickling, since 1996; manager,
Fidelity Overseas Fund, Fidelity Advisor
Overseas Fund and Fidelity VIP: Overseas,
1993-1996; Fidelity Advisor Annuity Overseas
Fund, 1995-1996; joined Fidelity in 1982
(checkmark)
INTERNATIONAL GROWTH & INCOME
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
FRANCE 8.7%
UNITED STATES 14.4%
ROW: 1, COL: 1, VALUE: 8.699999999999999
ROW: 1, COL: 2, VALUE: 7.8
ROW: 1, COL: 3, VALUE: 4.7
ROW: 1, COL: 4, VALUE: 15.1
ROW: 1, COL: 5, VALUE: 3.7
ROW: 1, COL: 6, VALUE: 19.3
ROW: 1, COL: 7, VALUE: 3.1
ROW: 1, COL: 8, VALUE: 4.2
ROW: 1, COL: 9, VALUE: 19.0
ROW: 1, COL: 10, VALUE: 14.4
GERMANY 7.8%
UNITED KINGDOM 19.0%
ITALY 4.7%
JAPAN 15.1%
SWEDEN 4.2%
NETHERLANDS 3.7%
SPAIN 3.1%
OTHER 19.3%
AS OF APRIL 30, 1997
FRANCE 7.3%
UNITED STATES 9.5%
ROW: 1, COL: 1, VALUE: 7.3
ROW: 1, COL: 2, VALUE: 9.199999999999999
ROW: 1, COL: 3, VALUE: 3.6
ROW: 1, COL: 4, VALUE: 18.1
ROW: 1, COL: 5, VALUE: 3.9
ROW: 1, COL: 6, VALUE: 27.2
ROW: 1, COL: 7, VALUE: 4.0
ROW: 1, COL: 8, VALUE: 17.1
ROW: 1, COL: 9, VALUE: 9.6
GERMANY 9.2%
UNITED KINGDOM 17.1%
ITALY 3.6%
SWEDEN 4.0%
JAPAN 18.0%
NETHERLANDS 4.1%
OTHER 27.2%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 66.0 69.9

BONDS 5.8 6.4

GOVERNMENT OBLIGATIONS 17.4 17.4

SHORT-TERM INVESTMENTS 10.8 6.3

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

NATIONALE ELF AQUITAINE 1.2 1.2
(FRANCE, OIL & GAS)

HONDA MOTOR CO. LTD. 1.0 1.3
(JAPAN, AUTOS, TIRES, & ACCESSORIES)

ALCATEL ALSTHOM COMPAGNIE GENERALE 1.0 1.1
D'ELECTRICITE SA
(FRANCE, ELECTRICAL EQUIPMENT)

SOCIETE GENERALE CLASS A 0.9 0.0
(FRANCE, BANKS)

AKZO NOBEL NV 0.8 0.6
(NETHERLANDS, CHEMICALS & PLASTICS)

SONY CORP. 0.8 1.1
(JAPAN, CONSUMER ELECTRONICS)

TELECOM ITALIA SPA 0.8 0.3
(ITALY, TELEPHONE SERVICES)

ACOM CO. LTD. 0.8 0.6
(JAPAN, CREDIT & OTHER FINANCE)

TOTAL SA SPONSORED ADR 0.7 0.7
(FRANCE, OIL & GAS)

ROYAL DUTCH PETROLEUM CO. ORD. 0.7 0.7
(NETHERLANDS, OIL & GAS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 17.8 15.3

UTILITIES 7.5 8.6

DURABLES 7.4 10.2

BASIC INDUSTRIES 6.7 4.0

CONSTRUCTION & REAL ESTATE 4.6 3.1

ENERGY 4.6 4.4

TECHNOLOGY 4.3 7.2

HEALTH 3.7 3.6

INDUSTRIAL MACHINERY & EQUIPMENT 3.6 4.2

NONDURABLES 3.3 5.3

INTERNATIONAL GROWTH & INCOME
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 64.9%
SHARES VALUE (NOTE 1)
ARGENTINA - 1.2%
Banco de Galicia Y Buenos Aires SA
sponsored ADR representing Class B
shares 46,603 $ 1,129,397
Bansud SA Class B (a) 140,000 1,246,723
Telefonica de Argentina SA
sponsored ADR 151,300 4,255,313
YPF Sociedad Anonima sponsored
ADR representing Class D shares 191,000 6,112,000
12,743,433
AUSTRALIA - 0.5%
Brambles Industries Ltd. 145,000 2,779,173
Fosters Brewing Group Ltd. 645,000 1,220,879
National Mutual Holdings Ltd. (f) 407,000 699,052
4,699,104
AUSTRIA - 0.4%
KTM-Motorradholding AG (f) 15,500 939,007
Mayr Melnhof Karton AG 50,000 2,658,150
3,597,157
BELGIUM - 0.4%
Credit Communal Holding/Dexia (f) 16,000 1,744,653
Petrofina SA 5,700 2,094,469
3,839,122
BRAZIL - 1.5%
Aracruz Celulose SA ADR 310,000 4,650,000
Banco de Credito Nacional SA 70,000,000 555,506
Compania Energertica Minas Gerais 39,500,000 1,576,275
Eletrobras ON 3,200,000 1,291,493
Petrobras PN (Pfd. Reg.) 15,100,000 2,807,455
Telebras ON 34,900,000 3,101,626
Telesp:
ON (a) 479,988 102,301
PN (Pfd. Reg.) 6,708,986 1,752,393
PN rights 11/12/97 (a) 407,569 370
15,837,419
CANADA - 2.0%
Agrium, Inc. 1,950 21,806
Cinar Films, Inc. Class B (sub-vtg.) (a) 48,000 1,847,137
Common Development International
Ltd. (a)(f) 54,000 1,265,221
Domtar, Inc. 595,800 4,632,049
Hudson's Bay Co. 146,000 1,508,254
Hudson's Bay Co. Ord. 83,900 1,921,101
JDS Fitel, Inc. (a) 71,200 4,082,076
National Bank of Canada 405,400 5,771,075
Westaim Corp. (a) 1,946 12,297
21,061,016
CHILE - 0.0%
Vina Concha Stet y Toro SA
sponsored ADR 15,300 416,925
CHINA (PEOPLES REPUBLIC) - 0.0%
First Tractor Co. Ltd. Class H (a) 230,000 178,525
DENMARK - 0.7%
International Service Systems AS,
Series B (a) 6,800 206,139
Novo-Nordisk AS Class B 30,000 3,244,725
Unidanmark AS Class A 50,000 3,374,210
6,825,074

SHARES VALUE (NOTE 1)
FINLAND - 1.1%
Cultor OY Ord., Series 2 35,000 $ 1,871,983
Finnair OY 500,000 3,861,749
Nokia Corp. AB, Series A 30,000 2,618,266
Rauma OY 2,784 52,412
UPM-Kymmene Corp. 150,000 3,374,204
11,778,614
FRANCE - 7.1%
Alcatel Alsthom Compagnie Generale
d'Electricite SA 82,900 9,987,692
Axa SA 80,000 5,470,014
Cap Gemini Sogeti SA 47,400 3,757,900
Compagnie Generale de
Geophysique SA (a) 15,000 2,077,221
Credit Commercial de France Ord. 100,000 5,656,964
Groupe GTM 15,000 934,749
Michelin SA (Compagnie Generale des
Etablissements) Class B 30,000 1,536,624
Nationale Elf Aquitaine 100,000 12,359,463
Pechiney SA Class A 100,770 4,137,589
Renault SA Partners Certificate 4,700 1,452,237
Renault SA Ord. (a) 160,000 4,445,252
Rhone Poulenc SA Class A 120,000 5,224,210
Societe Generale Class A 70,000 9,572,525
Total SA sponsored ADR 140,294 7,786,317
74,398,757
GERMANY - 3.3%
Daimler-Benz AG Ord. 100,000 6,713,043
Dresdner Bank AG Ord. 110,000 4,514,783
Hoechst AG Ord. 65,000 2,483,188
Hornbach Baumarket AG (Bearer) 9,550 282,901
Lufthansa Deutsche AG (Reg.) 150,000 2,682,609
Mannesmann AG Ord. 4,500 1,904,348
Metallgesellschaft AG Ord. (a) 100,000 2,005,797
Pfleiderer AG (f) 92,000 1,920,000
Philipp Holzmann AG (a) 16,500 4,686,957
Puma AG 70,000 1,736,812
Schmalbach-Lubeca AG 8,000 1,484,058
Siemens AG 25,000 1,530,435
Volkswagen AG 4,500 2,651,739
34,596,670
HONG KONG - 2.1%
Cafe De Coral Holdings Ltd. 2,026,000 395,765
China Telecom (Hong Kong) Ltd. (a) 1,836,000 2,933,325
Citic Pacific Ltd. Ord. 326,000 1,560,414
Dairy Farm International
Holdings Ltd. 2,767,000 2,185,944
Hong Kong Electric Holdings Ord. 1,830,000 6,202,587
Jardine Strategic Holdings Ltd. Ord. 589,839 1,887,485
Johnson Electric Holdings Ltd. 1,336,800 3,648,962
South China Morning Post Holdings 3,762,000 3,260,724
Sun Hung Kai & Co. Ltd. 1,000 246
Sun Hung Kai & Co. Ltd.
warrants 2/28/00 (a) 200 -
22,075,452
INDONESIA - 0.4%
PT Astra International 455,000 338,091
PT Bank International
Indonesia (For. Reg.) 3,096,285 666,562
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
INDONESIA - CONTINUED
PT Bank International Indonesia
warrants 1/17/00 (For. Reg.) (a) 453,002 $ 25,670
PT Lippo Life Insurance 2,043,000 269,563
PT Indosat Class B 683,000 1,541,494
PT Telkom 1,351,000 1,257,182
4,098,562
IRELAND - 0.1%
Kingspan Group PLC (UK) 50,000 886,955
ITALY - 2.7%
Assicurazioni Generali Spa 190,000 4,241,696
Credito Italiano Ord. 1,800,000 4,817,887
Ericsson Spa 9,500 381,438
Italcementi Fabbriche Ruinite Cemento
Spa, Bergamo 50,000 344,704
Montedison Spa Ord. 2,800,000 2,265,546
Rinascente per l'Esercizio di Grandi
Magazzini Spa 350,000 2,594,215
Telecom Italia Spa 1,322,220 8,269,778
Telecom Italia Mobile Spa 310,000 1,144,289
Toro Assicurazioni Spa Ord. 150,000 1,792,976
Unicem Spa 240,000 1,855,007
27,707,536
JAPAN - 12.5%
Acom Co. Ltd. 145,000 7,948,505
Daiwa Bank 383,000 1,425,116
Daito Trust Construction Co. 162,200 1,441,478
Fuji Heavy Industries Ltd. 692,000 2,753,057
Fuji Photo Film Co. Ltd. 175,000 6,337,209
Fujitsu Ltd. 277,000 3,036,877
Hitachi Maxell Ltd. 200,000 4,451,827
Honda Motor Co. Ltd. 301,000 10,125,000
Industrial Bank of Japan 273,000 2,698,256
Jusco Co. Ltd. 99,000 2,211,877
Kokusai Electric Co. Ltd. 210,000 3,156,977
Long Term Credit Bank of
Japan Ltd. (The) 1,439,000 4,864,394
Mabuchi Motor Co. 40,000 2,225,914
Matsushita Electric Industrial Co. Ltd. 306,000 5,133,887
Minebea Co. Ltd. 418,000 4,166,113
Mitsubishi Estate Co. Ltd. 147,000 1,855,814
Nintendo Co. Ltd. Ord. 28,600 2,470,432
Nitto Denko Corp. 200,000 3,604,651
Omron Corp. 100,000 1,694,352
Orix Corp. 47,900 3,270,249
Ricoh Co. Ltd. Ord. 250,000 3,218,439
Sakura Bank Ltd. 452,000 1,843,289
Sakura Finance Bermuda Trust:
sponsored ADR (f) 35 1,645,386
unit (Reg.) 22 1,085,382
Sankyo Co. Ltd. 191,000 6,297,924
Shin-Etsu Chemical Co. Ltd. 2,000 48,837
Shin-Etsu Chemical Co. Ltd.
warrants 8/15/00 (a) 280 682,500
Sony Corp. 100,000 8,297,342
Sumitomo Realty & Development
Co. Ltd. 260,000 1,898,173
TDK Corp. 46,000 3,812,957
THK Co. Ltd. 45,000 601,744
Takeda Chemical Industries Ltd. 235,000 6,401,993

SHARES VALUE (NOTE 1)
Takefuji Corp. 43,000 $ 1,910,714
Tokio Marine & Fire Insurance
Co. Ltd. (The) 503,000 5,013,289
Toyota Motor Corp. 100,000 2,782,392
Uni Charm Corp. Ord. 121,000 4,070,183
Yamanouchi Pharmaceutical Co. Ltd. 50,000 1,229,236
Yamaha Motor Co. Ltd. 215,000 1,732,143
Yasuda Trust & Banking 1,057,000 2,818,081
130,261,989
MALAYSIA - 0.1%
Arab Malaysian Corp. BHD 320,000 282,746
AMMB Holdings BHD 98,000 159,433
Hong Leong Credit BHD 674,400 938,121
Tenega Nasional BHD 1,000 2,149
1,382,449
MEXICO - 1.9%
Consorcio G Grupo Dina SA de CV
sponsored ADR (a) 482,900 2,354,138
DESC (Sociedad de Fomento Industrial SA)
Class B 209,000 1,795,704
Grupo Financiero Bancomer Class B (a) 12,200,000 5,750,597
Grupo Financiero Inbursa SA Class B 979,000 3,446,360
Telefonos de Mexico SA sponsored ADR
representing Ord. Class L shares 90,000 3,892,500
Tubos de Acero de Mexico ADR (a) 110,000 2,220,625
19,459,924
NETHERLANDS - 3.2%
AKZO Nobel NV 50,300 8,847,111
ING Groep NV 100,000 4,190,231
Koninklijke KNP BT NV 90,000 2,045,244
Royal Dutch Petroleum Co. Ord. 140,000 7,392,288
Royal PTT Nederland NV 80,000 3,051,928
Unilever NV Ord. 58,000 3,077,429
Vendex International NV 80,243 4,373,140
32,977,371
NORWAY - 0.9%
Det Sondenfjelds-Norske
Dampskibselskab, Class A (a) 120,000 2,684,449
Kvaerner AS Class B 35,000 1,683,124
Smedvig AS 76,800 2,308,968
Smedvig AS, Series B 19,200 563,563
SAS Norske ASA Shares B 150,000 2,522,014
9,762,118
PHILIPPINES - 0.1%
Empire East Land, Inc. (a) 1,668,500 40,176
Guoco Holdings Philippines, Inc. 645,000 20,099
Megaworld Properties & Holdings, Inc. (a) 10,548,000 496,025
556,300
PORTUGAL - 0.8%
Banco Totta & Acores
Nationalisiert (Reg.) 135,000 2,604,994
Electricidade de Portugal SA 147,000 2,577,923
Portugal Telecom SA 85,000 3,480,562
8,663,479
RUSSIA - 0.2%
Vimpel Communications
sponsored ADR 65,700 2,151,675
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
SINGAPORE - 0.0%
Kim Engineering Holdings Ltd. 20,000 $ 9,154
SOUTH AFRICA - 0.2%
Sasol Ltd. 112,100 1,350,322
South African Breweries Ltd. 25,000 664,590
2,014,912
SPAIN - 3.1%
Banco Bilbao Vizcaya SA Ord. (Reg.) 205,000 5,469,103
Banco Popular Espanol 60,000 3,534,737
Corporacion Mapfre Compania
Internacional de Reaseguros SA (Reg.) 74,017 3,375,715
Dragados y Construcciones SA 225,000 4,552,157
FOCSA (Fomento Construcciones y
Contratas SA) 40,000 1,467,663
Iberdrola SA 250,000 2,983,334
Telefonica de Espana SA Ord. 260,000 7,079,075
Vallehermoso SA 100,000 2,537,549
Viscofan Envolturas Celulo SA 80,000 1,640,491
32,639,824
SWEDEN - 3.3%
Astra AB Class A Free shares 315,000 5,070,170
Electrolux AB 50,000 4,123,711
Ericsson (L.M.) Telephone Co. Class B 50,000 2,194,879
(IFS) Industrial & Financial Systems AB
Class B (vtg.) (a) 200,000 1,263,718
Mo Och Domsjoe AB Class B 175,000 4,725,640
Scania AB Class B 65,000 1,595,278
Skandia Foersaekrings AB 60,000 2,793,482
Svenska Handelsbanken 150,000 4,728,966
Volvo AB:
Class B 249,500 6,505,088
ADR Class B 50,000 1,300,000
34,300,932
SWITZERLAND - 1.5%
Credit Suisse Group (Reg.) 33,400 4,710,869
Danzas Holdings AG (Reg.) 10,000 2,002,145
Julius Baer Holding AG 625 934,036
Nestle SA (Reg.) 1,700 2,398,355
SIG AG (Reg.) 2,500 3,324,991
Sulzer AG (Reg.) 3,500 2,562,746
15,933,142
UNITED KINGDOM - 13.1%
Albright & Wilson PLC 1,525,000 4,147,142
BBA Group PLC 650,000 4,383,733
Biocompatibles International
PLC Class L (a) 125,000 1,192,369
British Aerospace PLC 276,197 7,312,252
British Borneo Petroleum 275,000 2,199,816
British Steel PLC Ord. 1,050,000 2,776,337
British Telecommunications PLC Ord. 430,000 3,259,811
British Vita Ord. 500,000 2,024,935
Burmah Oil 100,000 1,715,338
Cable & Wireless PLC Ord. 505,000 4,022,759
Cadbury-Schweppes PLC Ord. 325,000 3,263,325
Caradon PLC 1,106,851 3,519,399
Commercial Union PLC 410,000 5,763,534
Cookson Group PLC 1,097,544 4,389,808
Cordiant PLC 307,300 632,548
Dalgety PLC 450,000 1,841,268
De la Rue PLC 300,000 2,123,672

SHARES VALUE (NOTE 1)
English China Clay PLC 1,200,000 $ 5,221,320
General Electric Co. PLC Class L 840,000 5,352,356
Grand Metropolitan PLC 308,800 2,780,259
IMI PLC 100,000 662,706
ICI (Imperial Chemical Industries)
PLC Class L 190,000 2,798,092
Iceland Group PLC 2,099,900 4,287,303
Inchcape PLC Ord. 1,400,000 5,107,522
Ladbroke Group PLC Ord. 998,983 4,463,701
Legal & General Group Ltd. Ord. 700,000 5,798,678
Lloyds TSB Group PLC 215,000 2,680,529
National Westminster Bank PLC Ord. 340,000 4,876,244
Pearson, PLC 236,000 3,080,579
Pilkington PLC Ord. 2,900,000 7,279,725
RMC Industries, Inc. 225,000 3,422,726
Royal & Sun Alliance Insurance
Group PLC 628,209 6,008,224
Shanks & McEwan Group PLC 375,000 953,895
Smith Holdings PLC 306,300 1,168,712
Tarmac 2,500,000 4,894,988
Tomkins PLC Ord. 700,000 3,584,637
Vodafone Group PLC 1,350,000 7,353,777
136,344,019
UNITED STATES OF AMERICA - 0.5%
Pharmacia & Upjohn, Inc. 155,000 4,921,250
TOTAL COMMON STOCKS
(Cost $587,357,492) 676,118,859
PREFERRED STOCKS - 1.1%
CONVERTIBLE PREFERRED STOCKS - 0.4%
AUSTRALIA - 0.2%
National Australia Bank Ltd. 7.8750% 80,000 2,225,000
JAPAN - 0.2%
AJL participating trust $1.44 117,100 1,712,588
UNITED KINGDOM - 0.0%
Iceland Group PLC 5 1/2% 400,000 662,706
TOTAL CONVERTIBLE PREFERRED STOCKS 4,600,294
NONCONVERTIBLE PREFERRED STOCKS - 0.7%
GERMANY - 0.2%
Krones AG 4,500 1,526,087
ITALY - 0.5%
Italmobiliare Spa 90,000 821,496
Telecom Italia Spa 1,195,000 4,811,928
5,633,424
TOTAL NONCONVERTIBLE PREFERRED STOCKS 7,159,511
TOTAL PREFERRED STOCKS
(Cost $11,129,554) 11,759,805
CORPORATE BONDS - 5.8%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (E) AMOUNT (C) (NOTE 1)
CONVERTIBLE BONDS - 5.1%
CHINA (PEOPLES REPUBLIC) - 0.2%
Qingling Motors Ltd.
3 1/2%, 1/22/02 (f) - $ 1,800,000 $ 1,998,000
GERMANY - 0.0%
Daimler Benz AG
5 3/4%, 6/14/02 A2 DEM 1,470 109,930
HONG KONG - 0.2%
Shanghai Investment Holdings Ltd.
1%, 6/12/02 (f) - 2,000,000 1,900,000
JAPAN - 2.1%
Asahi Breweries Ltd.
6.40%, 10/16/98 - JPY 306,000,000 4,168,106
Hitachi Ltd. 1.70%, 3/29/02 Aa2 JPY 159,000,000 1,518,688
MBL International Finance of
Bermuda 3%, 11/30/02 Aa2 7,830,000 8,006,175
Matsushita Electric Works Co. Ltd.
2.70%, 5/31/02 - JPY 81,000,000 823,455
STB CayMan Capital Ltd.
1/2%, 10/1/07 (f) Baa2 JPY 235,000,000 1,854,236
Sony Corp. 0.15%, 3/30/01 Aa3 JPY 100,000,000 1,287,375
Sumitomo Bank International
Finance NV
3/4%, 5/31/01 (Reg.) A2 JPY 123,000,000 1,017,764
Sumitomo Bank International
Finance NV
3/4%, 5/31/01 (f) A2 JPY 62,000,000 513,019
Takeda Chemical Industries Ltd.
1.90%, 9/30/98 - JPY 200,000,000 2,524,917
21,713,735
MEXICO - 0.7%
Alfa SA de CV 8%,
9/15/00 (f) - 1,900,000 2,935,500
Empresas Ica Sociedad
Controladora SA de CV
5%, 3/15/04 B3 6,000,000 4,507,500
7,443,000
NETHERLANDS - 0.5%
Bilbao Vizcaya Investments BV
3 1/2%, 7/12/06 Aa3 2,500,000 4,175,000
Volkswagen AG 3%,
1/24/02 (f) A1 1,100,000 1,289,750
5,464,750
POLAND - 0.2%
BPH Finance BV 3%,
5/22/02 (f) - 2,000,000 2,070,000
SWITZERLAND - 0.6%
Sandoz Capital BVI Ltd.
2%, 10/6/02 - 4,390,000 6,497,200
THAILAND - 0.2%
Bangkok Bank PCL euro
3 1/4%, 3/3/04 (f) - 3,830,000 1,828,825
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (E) AMOUNT (C) (NOTE 1)
UNITED KINGDOM - 0.4%
Glaxo Wellcome PLC
4.30%, 9/28/98 Aa3 JPY 195,000,000 $ 2,688,538
Grand Metropolitan PLC euro
6 1/2%, 1/31/00 A2 1,250,000 1,625,000
4,313,538
TOTAL CONVERTIBLE BONDS 53,338,978
NONCONVERTIBLE BONDS - 0.7%
JAPAN - 0.3%
Sony Corp. 1.40%, 3/31/05 Aa3 JPY 220,000,000 2,411,960
LUXEMBOURG - 0.4%
Daimler-Benz Capital AG
4 1/8%, 7/5/03 A1 DEM 5,750,000 4,304,167
TOTAL NONCONVERTIBLE BONDS 6,716,127
TOTAL CORPORATE BONDS
(Cost $57,104,588) 60,055,105
GOVERNMENT OBLIGATIONS (G) - 17.4%
DENMARK - 0.5%
Danish Kingdom Bullet
8%, 5/15/03 Aaa DKK 29,000,000 4,915,134
FRANCE - 1.6%
French Government:
8 1/2%, 12/26/12 Aaa FRF 17,000,000 3,721,375
OAT:
7 1/4%, 4/25/06 Aaa FRF 20,000,000 3,881,287
6%, 10/25/25 Aaa FRF 35,000,000 5,892,556
Principal Strips 0%,
10/25/25 Aaa FRF 110,000,000 3,262,784
16,758,002
GERMANY - 4.3%
German Federal Republic:
8%, 7/22/02 Aaa DEM 9,300,000 6,060,365
6%, 6/20/16 Aaa DEM 32,600,000 18,904,220
Treuhandanstalt:
6 5/8%, 7/9/03 Aaa DEM 12,200,000 7,566,829
7 1/2%, 9/9/04 Aaa DEM 20,000,000 12,995,942
45,527,356
ITALY - 1.5%
Italian Republic (d):
8 1/2%, 4/1/99 Aa3 ITL 15,600,000 9,554,267
10 1/2%, 9/1/05 Aa3 ITL 8,000,000 5,991,528
15,545,795
SWEDEN - 0.9%
Swedish Government
13%, 6/15/01 Aa1 SEK 60,000,000 9,817,173
UNITED KINGDOM - 5.5%
United Kingdom, Great Britain &
Northern Ireland:
9 1/2%, 1/15/99 Aaa GBP 4,500,000 7,743,140
9 3/4%, 8/27/02 Aaa GBP 13,100,000 24,601,559
GOVERNMENT OBLIGATIONS (G) - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (E) AMOUNT (C) (NOTE 1)
UNITED KINGDOM - CONTINUED
United Kingdom, Great Britain &
Northern Ireland: - continued
9 1/2%, 4/18/05 Aaa GBP 2,500,000 $ 4,876,684
7 3/4%, 9/8/06 Aaa GBP 5,100,000 9,180,298
9%, 10/13/08 Aaa GBP 2,200,000 4,387,839
8 3/4%, 8/25/17 Aaa GBP 3,000,000 6,243,072
57,032,592
UNITED STATES OF AMERICA - 3.1%
U.S. Treasury Obligations:
9 1/4%, 8/15/98 Aaa 7,385,000 7,590,377
9 1/8%, 5/15/99 Aaa 7,400,000 7,773,478
7 3/4%, 12/31/99 Aaa 7,550,000 7,866,119
7 1/4%, 2/15/23 Aaa 750,000 834,728
6 1/4%, 8/15/23 Aaa 830,000 832,980
7 1/2%, 11/15/24 Aaa 1,570,000 1,831,750
7 5/8%, 2/15/25 Aaa 2,750,000 3,256,165
6 7/8%, 8/15/25 Aaa 1,860,000 2,023,048
32,008,645
TOTAL GOVERNMENT OBLIGATIONS
(Cost $178,595,785) 181,604,697
CASH EQUIVALENTS - 10.8%
SHARES
Taxable Central Cash Fund (b)
(Cost $112,514,547) 112,514,547 112,514,547
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $946,701,966) $ 1,042,053,013
CURRENCY ABBREVIATIONS
GBP - British pound
FRF - French franc
DEM - German deutsche mark
DKK - Danish krone
ITL - Italian lira
JPY - Japanese yen
SEK - Swedish krona
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Principal amount is stated in United States dollars unless
otherwise noted.
(d) Principal amount in thousands.
(e) Standard & Poor's credit ratings are used in the absence of a
rating by Moody's Investors Service, Inc.
(f) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$22,602,649 or 2.1% of net assets.
(g) For foreign government obligations not individually rated by S&P
or Moody's, the ratings listed are assigned to securities by FMR, the
fund's investment adviser, based principally on S&P and Moody's
ratings of the sovereign credit of the issuing government.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total
value of investment in securities, is as follows (ratings are
unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 19.3% AAA, AA, A 18.5%
Baa 0.2% BBB 0.3%
Ba 0.0% BB 0.4%
B 0.4% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
For some foreign government obligations, FMR has assigned the ratings
of the sovereign credit of the issuing government. The percentage not
rated by Moody's or S&P amounted to 2.4%.
Purchases and sales of securities, other than short-term securities,
aggregated $714,904,706 and $817,583,117, respectively (see Note 3 of
Notes to Financial Statements).
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of Fidelity Management & Research Company.
The commissions paid to these affiliated firms were $140,274 for the
period (see Note 4 of Notes to Financial Statements).
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $947,002,868. Net unrealized appreciation
aggregated $95,050,145, of which $140,723,741 related to appreciated
investment securities and $45,673,596 related to depreciated
investment securities.
The fund hereby designates approximately $38,778,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.7%
Basic Industries 6.7
Cash Equivalents 10.8
Construction & Real Estate 4.6
Durables 7.4
Energy 4.6
Finance 17.8
Government Obligations 17.4
Health 3.7
Holding Companies 0.9
Industrial Machinery & Equipment 3.6
Media & Leisure 1.6
Nondurables 3.3
Retail & Wholesale 2.6
Services 0.6
Technology 4.3
Transportation 1.9
Utilities 7.5
100.0%
INTERNATIONAL GROWTH & INCOME
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE (COST $946,701,966) - SEE ACCOMPANYING SCHEDULE $ 1,042,053,013

RECEIVABLE FOR INVESTMENTS SOLD 13,042,063

RECEIVABLE FOR FUND SHARES SOLD 17,543,191

DIVIDENDS RECEIVABLE 2,515,892

INTEREST RECEIVABLE 4,263,340

OTHER RECEIVABLES 4,968

TOTAL ASSETS 1,079,422,467

LIABILITIES

PAYABLE TO CUSTODIAN BANK $ 63,086

PAYABLE FOR INVESTMENTS PURCHASED 1,954,204

PAYABLE FOR FUND SHARES REDEEMED 8,896,463

ACCRUED MANAGEMENT FEE 714,713

OTHER PAYABLES AND 624,973
ACCRUED EXPENSES

TOTAL LIABILITIES 12,253,439

NET ASSETS $ 1,067,169,028

NET ASSETS CONSIST OF:

PAID IN CAPITAL $ 877,206,443

UNDISTRIBUTED NET INVESTMENT INCOME 22,266,921

ACCUMULATED UNDISTRIBUTED 72,250,753
NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 95,444,911
AND ASSETS AND LIABILITIES IN
FOREIGN CURRENCIES

NET ASSETS, FOR 51,120,211 $ 1,067,169,028
SHARES OUTSTANDING

NET ASSET VALUE, OFFERING PRICE $20.88
AND REDEMPTION PRICE PER SHARE ($1,067,169,028 (DIVIDED BY) 51,120,211 SHARES)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 17,647,054
DIVIDENDS

SPECIAL DIVIDEND FROM BRITISH GAS 2,427,323
PLC ORD.

INTEREST 19,912,464

39,986,841

LESS FOREIGN TAXES WITHHELD (2,023,354)

TOTAL INCOME 37,963,487

EXPENSES

MANAGEMENT FEE $ 8,152,782

TRANSFER AGENT FEES 3,087,981

ACCOUNTING FEES AND EXPENSES 600,005

NON-INTERESTED TRUSTEES' COMPENSATION 6,412

CUSTODIAN FEES AND EXPENSES 564,689

REGISTRATION FEES 74,823

AUDIT 59,373

LEGAL 12,240

REPORTS TO SHAREHOLDERS 152,099

MISCELLANEOUS 41,813

TOTAL EXPENSES BEFORE REDUCTIONS 12,752,217

EXPENSE REDUCTIONS (207,088) 12,545,129

NET INVESTMENT INCOME 25,418,358

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 74,374,277

FOREIGN CURRENCY TRANSACTIONS (1,131,161) 73,243,116

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 33,684,570

ASSETS AND LIABILITIES IN 5,883 33,690,453
FOREIGN CURRENCIES

NET GAIN (LOSS) 106,933,569

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 132,351,927

OTHER INFORMATION $ 119,529
EXPENSE REDUCTIONS
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 8,203

TRANSFER AGENT CREDITS 79,356

$ 207,088

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 25,418,358 $ 27,101,159
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 73,243,116 58,081,824

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 33,690,453 13,275,048

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 132,351,927 98,458,031

DISTRIBUTIONS TO SHAREHOLDERS (15,358,151) (30,254,272)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (19,594,396) -

TOTAL DISTRIBUTIONS (34,952,547) (30,254,272)

SHARE TRANSACTIONS 1,459,910,318 756,874,122
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 34,047,249 29,614,909

COST OF SHARES REDEEMED (1,531,263,569) (750,852,349)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (37,306,002) 35,636,682

TOTAL INCREASE (DECREASE) IN NET ASSETS 60,093,378 103,840,441

NET ASSETS

BEGINNING OF PERIOD 1,007,075,650 903,235,209

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $22,266,921 AND
$21,693,374, RESPECTIVELY) $ 1,067,169,028 $ 1,007,075,650

OTHER INFORMATION
SHARES

SOLD 70,794,239 41,219,618

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,787,246 1,655,407

REDEEMED (74,210,657) (40,792,385)

NET INCREASE (DECREASE) (1,629,172) 2,082,640

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 E 1993

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 19.09 $ 17.83 $ 17.54 $ 17.25 $ 13.29

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .48 D, .54 .54 .38 D .14 D
H

NET REALIZED AND UNREALIZED GAIN (LOSS) 1.97 1.32 .28 .02 4.14

TOTAL FROM INVESTMENT OPERATIONS 2.45 1.86 .82 .40 4.28

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.29) (.60) (.21) (.03) (.31)

FROM NET REALIZED GAIN (.37) - (.32) (.05) (.01) B

IN EXCESS OF NET REALIZED GAIN - - - (.03) -

TOTAL DISTRIBUTIONS (.66) (.60) (.53) (.11) (.32)

NET ASSET VALUE, END OF PERIOD $ 20.88 $ 19.09 $ 17.83 $ 17.54 $ 17.25

TOTAL RETURN A 13.17% 10.66% 4.95% 2.33% 32.94%
C

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 1,067,169 $ 1,007,076 $ 903,235 $ 1,367,938 $ 1,002,847

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.17% 1.16% 1.18% 1.21% 1.52%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.15% 1.14% 1.18% 1.21% 1.52%
F F

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 2.33% 2.76% 2.98% 2.16% .87%

PORTFOLIO TURNOVER RATE 70% 95% 141% 173% 24%

AVERAGE COMMISSION RATE G $ .0068 $ .0065

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO
FINANCIAL STATEMENTS). B INCLUDES AMOUNTS DISTRIBUTED FROM NET
REALIZED GAINS ON FOREIGN CURRENCY RELATED
TRANSACTIONS TAXABLE AS ORDINARY INCOME. C TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES CHARGE. DNET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. E EFFECTIVE NOVEMBER 1, 1993, THE
FUND ADOPTED STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE,
AND FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN,
AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES." AS
A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT
CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. F
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS). G FOR
FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS
REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR
SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY
VARY FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON
THE MIX OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING PRACTICES
AND COMMISSION RATE STRUCTURES MAY DIFFER. H INVESTMENT INCOME PER
SHARE REFLECTS A SPECIAL DIVIDEND FROM BRITISH GAS PLC ORD. WHICH
AMOUNTED TO $.05 PER SHARE.

</TABLE>

DIVERSIFIED INTERNATIONAL
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Fidelity had not reimbursed certain fund
expenses, the life of fund total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

DIVERSIFIED INTERNATIONAL 19.30% 125.84% 91.06%

MORGAN STANLEY CAPITAL 8.63% 81.61% 66.51%
INTERNATIONAL GDP-WEIGHTED
EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 82.99% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on December 27, 1991. For example, if you had
invested $1,000 in a fund that had a 5% return over the past year, the
value of your investment would be $1,050. You can compare the fund's
returns to the performance of the Morgan Stanley Capital International
(MSCI) GDP-Weighted Europe, Australasia, Far East (EAFE) Index - a
gross domestic product weighted, unmanaged index of over 1,000 foreign
stocks. To measure how the fund's performance stacked up against its
peers, you can compare it to the international funds average, which
reflects the performance of mutual funds with similar objectives
tracked by Lipper Analytical Services, Inc. The past one year average
represents a peer group of 406 mutual funds. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

DIVERSIFIED INTERNATIONAL 19.30% 17.70% 11.70%

MORGAN STANLEY CAPITAL 8.63% 12.67% 9.11%
INTERNATIONAL GDP-WEIGHTED
EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 12.67% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the
potential for significant growth over time;
however, investing in foreign markets means
assuming greater risks than investing in the
United States. Factors like changes in a
country's financial markets, its local political
and economic climate, and the fluctuating value
of its currency create these risks. For these
reasons an international fund's performance
may be more volatile than a fund that invests
exclusively in the United States. Past
performance is no guarantee of future results
and you may have a gain or loss when you sell
your shares.
(checkmark)
DIVERSIFIED INTERNATIONAL
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Greg Fraser, Portfolio Manager of
Fidelity Diversified International Fund
Q. HOW DID THE FUND PERFORM, GREG?
A. The fund returned 19.30% for the 12-month period that ended October
31, 1997. For the same time period, the Morgan Stanley Capital
International GDP-Weighted Europe, Australasia, Far East (EAFE) Index
- - was up 8.63%, while the international funds average returned 10.39%,
according to Lipper Analytical Services.
Q. WHAT FACTORS CONTRIBUTED MOST TO THE FUND'S OUTPERFORMANCE OF THE
INDEX?
A. There were a number of reasons the fund did better than the index.
First, it continued to have a lower weighting in Japan than the index,
which boosted performance because the Japanese market did poorly over
the period. The fund also benefited from having about 8% of its assets
invested in Canada, where the index had no holdings. Many Canadian
companies turned in surprisingly strong performances over the period,
largely because economic growth was better than expected and inflation
was lower than expected. In addition, the fund was helped during the
period when some of the closed-end funds that it had owned for a while
- - such as GT Global Developing Markets Fund and Alliance Global
Environmental - took positive steps to unlock shareholder value by
"open-ending." If a closed-end fund that has been trading at a
discount open-ends, shareholders can redeem their shares at
net-asset-value, thereby realizing a better price for their holdings.
Q. ANY OTHER REASONS BEHIND THE FUND'S STRONG PERFORMANCE?
A. Not specific ones. I should note that overall no single stock or
country was that important to the fund's performance. What was
important was generally strong stock picking across a range of
industries and countries. In terms of the fund's top holdings, an
eclectic group of stocks helped the fund. Swiss pharmaceutical company
Novartis - the fund's largest holding as well as its top-contributing
stock - strongly benefited from cost-cutting measures. Novartis was
formed about a year ago from the merger of pharmaceutical giants
Ciba-Geigy and Sandoz. Japanese exporters, such as Fuji Photo and
Sony, also turned in strong performances. These companies did well
despite Japan's weak economy because they were more sensitive to the
global than the local economy. The fund also was helped by European
restructuring stories, such as Alcatel Alsthom and Unilever, and
inexpensive financials, such as National Bank of Canada.
Q. HOW DID THE DECLINES IN THE ASIAN MARKETS AFFECT THE FUND?
A. The direct impact of the Asian market declines on the fund was
quite modest because the fund had very limited holdings in the region.
In fact, during the period, combined holdings in South Korea,
Thailand, Malaysia, the Philippines and Indonesia totaled less than 5%
of investments. However, concerns about the repercussions from the
declines in Southeast Asia increasingly affected other world markets,
and therefore hurt the fund somewhat. Some analysts believe that
events in Asia could foreshadow a worldwide slowing in economic
growth, or even a recession which probably would hurt the fund's
performance.
Q. FOR MUCH OF THE PERIOD, THE U.S. DOLLAR WAS QUITE STRONG AGAINST
MANY CURRENCIES, INCLUDING THE YEN AND THE DEUTSCHE MARK. HOW DID THE
STRONG DOLLAR AFFECT THE FUND OVER THE PERIOD?
A. As I've noted in previous reports to shareholders, a strong dollar
affects the fund in several ways. When the fund's holdings are
calculated in dollars, there is an immediate translation impact. That
is, a share priced in yen that is worth a certain number of dollars
will be worth fewer dollars if the dollar is strong, assuming that the
price in yen remains the same. At the same time, many analysts feel
that, longer term, a relatively weak currency can increase export
competitiveness because the exported goods will be less expensive.
That means that big exporting companies such as Sony can often
experience stronger earnings from a weaker currency. These expected
earnings gains are often reflected in stock prices before the improved
earnings are actually reported. So, the stock prices of companies that
are involved in exporting tend to do well - in local currency terms -
when their currency is weak. Thus, the longer-term business impact of
a weak currency can sometimes offset the translation impact, at least
for companies heavily involved in exports. Overall, the strength of
the dollar probably modestly held back the performance of the fund in
the past year. However, good price performance of many of the fund's
holdings in local currency terms still resulted in satisfactory
dollar-based returns for shareholders.
Q. THIS FUND USES QUANTITATIVE MODELS. CAN YOU BRIEFLY EXPLAIN HOW
THEY WORK?
A. Quantitative models help me focus on inexpensive stocks and
industry groups. They help me re-analyze companies quickly during
periods of volatile price movements. In this case, the lack of emotion
in the computer models is one of the strengths of the process. While
many investors focus on recent price movements, some of the most
useful models I use emphasize company valuations. So, instead of
becoming despondent when prices are falling, the models continually
re-evaluate the companies and may actually suggest that the fund buy
when many analysts are negative. Similarly, when investors become
euphoric, the models will tend to remind me that a company's shares
may be becoming too expensive. I should point out that over the past
several years, I've continued to spend an increasing amount of time on
fundamental research - analyzing the business prospects of each
company - to ensure that the quantitative models actually result in
good investment decisions in practice, not just in theory.
Q. WHICH INVESTMENTS WERE DISAPPOINTING FOR THE FUND?
A. The biggest disappointment continued to be the performance of the
smaller and non-export- oriented Japanese companies. The share prices
of many of these companies performed poorly in yen terms, and when
translated back into dollars, returns for dollar-based investors were
downright disappointing. While the fund owned a fairly large number of
these companies - such as Chubu Steel Plate Company, Higashi Nihon
House and Maruzen Showa Unyu Company - the sizes of the positions were
quite small. Currently, the valuations of many of these companies look
extremely appealing, and shareholders should not be surprised if the
fund increases small-capitalization Japanese holdings in a measured
and prudent fashion. The other disappointing group was gold mining
companies. As the price of gold bullion sank over the period,
especially in October, gold mining companies generally performed
poorly. While the fund had only a modest commitment to this sector,
stocks such as Vaal Reefs Exploration & Mining Company were
disappointing performers.
Q. GREG, WHAT'S THE OUTLOOK FOR THE FUND?
A. I continue to be somewhat cautious because of high valuations in
many markets around the world. Undoubtedly, international markets will
continue to provide challenges as currencies devalue, economies sour
and governments collapse. So, it is important to remind investors that
this fund is designed for long-term investors. Nevertheless, with the
ongoing corrections in many Asian markets, valuations have become much
more reasonable, so I'm spending a lot of time on the Asian markets
looking for companies that could be winners in the next up-cycle.
Therefore, shareholders shouldn't be surprised if the fund's
investments in emerging markets - including Asian countries - increase
in a moderate way. To sum it up, the long-term outlook for
satisfactory returns improves as prices and valuations decline, but
the extent and duration of market declines - which determine near-term
returns - cannot be predicted.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
CANADA 8.4%
UNITED STATES 11.1%
ROW: 1, COL: 1, VALUE: 11.1
ROW: 1, COL: 2, VALUE: 10.1
ROW: 1, COL: 3, VALUE: 4.7
ROW: 1, COL: 4, VALUE: 4.3
ROW: 1, COL: 5, VALUE: 29.9
ROW: 1, COL: 6, VALUE: 4.6
ROW: 1, COL: 7, VALUE: 14.4
ROW: 1, COL: 8, VALUE: 4.5
ROW: 1, COL: 9, VALUE: 8.0
ROW: 1, COL: 10, VALUE: 8.4
FRANCE 8.0%
UNITED
KINGDOM 10.1%
GERMANY 4.5%
SWITZERLAND 4.7%
SWEDEN 4.3%
JAPAN 14.4%
OTHER 29.9%
NETHERLANDS 4.6%
AS OF APRIL 30, 1997
AUSTRALIA 3.4%
UNITED STATES 12.7%
ROW: 1, COL: 1, VALUE: 12.7
ROW: 1, COL: 2, VALUE: 8.4
ROW: 1, COL: 3, VALUE: 5.1
ROW: 1, COL: 4, VALUE: 4.8
ROW: 1, COL: 5, VALUE: 24.7
ROW: 1, COL: 6, VALUE: 5.8
ROW: 1, COL: 7, VALUE: 17.1
ROW: 1, COL: 8, VALUE: 5.4
ROW: 1, COL: 9, VALUE: 4.9
ROW: 1, COL: 10, VALUE: 7.7
ROW: 1, COL: 11, VALUE: 3.4
CANADA 7.7%
FRANCE 4.9%
UNITED
KINGDOM 8.4%
GERMANY 5.4%
SWITZERLAND 5.1%
JAPAN 17.1%
SWEDEN 4.8%
NETHERLANDS 5.8%
OTHER 24.7%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS AND CLOSED-END 90.0 88.4
INVESTMENT COMPANIES

BONDS 0.5 0.3

SHORT-TERM INVESTMENTS 9.5 11.3

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

NOVARTIS AG (REG.) 1.5 1.9
(SWITZERLAND, DRUGS & PHARMACEUTICALS)

ALCATEL ALSTHOM COMPAGNIE GENERALE 1.4 1.3
D'ELECTRICITE SA SPONSORED ADR
(FRANCE, ELECTRICAL EQUIPMENT)

SHELL TRANSPORT & TRADING CO. PLC (REG.) 1.2 1.2
(UNITED KINGDOM, OIL & GAS)

NATIONAL BANK OF CANADA 1.1 1.4
(CANADA, BANKS)

CANADIAN NATIONAL RAILWAY CO. 0.9 0.2
(CANADA, RAILROADS)

UNILEVER NV ADR 0.9 1.3
(NETHERLANDS, HOUSEHOLD PRODUCTS)

SONY CORP. 0.9 1.4
(JAPAN, CONSUMER ELECTRONICS)

ENSO OY CLASS R 0.9 0.2
(FINLAND, PAPER & FOREST PRODUCTS)

NESTLE SA (REG.) 0.8 0.9
(SWITZERLAND, FOODS)

ELF AQUITAINE SA SPONSORED ADR 0.8 0.4
(FRANCE, OIL & GAS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 28.5 28.6

NONDURABLES 7.6 7.0

UTILITIES 7.1 5.2

BASIC INDUSTRIES 6.8 5.9

ENERGY 6.4 5.9

TECHNOLOGY 5.7 7.2

DURABLES 5.2 6.1

HEALTH 4.8 5.4

TRANSPORTATION 4.5 2.6

MEDIA & LEISURE 3.7 4.3

DIVERSIFIED INTERNATIONAL
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 79.7%
SHARES VALUE (NOTE 1)
ARGENTINA - 0.7%
Banco de Galicia y Buenos Aires SA
sponsored ADR representing
Class B shares 70,000 $ 1,699,254
Bansud SA Class B (a) 42,700 381,532
Metrogas SA Class B 100,000 73,042
Telecom Argentina Class B
sponsored ADR 100,000 2,531,250
Telefonica de Argentina SA
sponsored ADR 75,000 2,109,375
YPF Sociedad Anonima sponsored ADR
representing Class D shares 125,000 4,000,000
10,794,453
AUSTRALIA - 2.2%
AAP Telecommunications Properties Ltd. 540,500 700,997
Australia & New Zealand Banking
Group Ltd. 900,000 6,258,974
Australian Oil & Gas Corp. Ltd. 800,000 1,093,638
Burns Philp & Co. 200,000 105,158
Colonial Ltd. (a) 300,000 832,847
Commonwealth Bank of Australia (d) 450,000 5,157,975
Consolidated Rutile Ltd. 154,282 64,896
Foodland Associated Ltd. 500,000 3,715,565
Fosters Brewing Group Ltd. 750,000 1,419,626
Gandel Retail Trust GAN 650,000 451,126
Henry Walker Group Ltd. 50,000 75,363
Macquarie Bank Ltd. 90,000 694,040
National Australia Bank Ltd. 75,000 1,022,657
National Mutual Property Trust 1,033,333 825,837
News Corp. Ltd. sponsored ADR
(ltd. vtg.) 75,000 1,331,250
North Ltd. 100,000 261,351
Petsec Energy Ltd. sponsored ADR (a) 100,000 2,250,000
Premier Investment Ltd. 130,000 164,046
Qantas Airways Ltd. 450,000 804,455
Santos Ltd. 337,500 1,547,393
Savage Resources Ltd. 308,436 177,308
Savage Resources Ltd.
warrants 11/30/98 (a) 5,500 308
Seven Network Ltd. 100,000 357,536
Siddons Ramset Ltd. 106,475 529,975
Tyndall Australia Ltd. 983,544 1,578,986
Westfield Trust 538,036 1,022,185
Westfield Trust (New) (a) 11,964 21,304
32,464,796
AUSTRIA - 1.0%
Austria Tabak AG (d) 67,600 2,813,765
EVN (Energie-Versor Nieder) 10,000 1,160,519
OMV AG (d) 10,000 1,421,801
Vae AG (e) 75,000 7,356,274
Voest-Alpine Stahl AG 50,000 2,163,610
14,915,969
BAHAMAS (NASSAU) - 0.1%
Sun International Hotels Ltd. Ord. (a) 50,000 1,800,000
BELGIUM - 0.0%
Floridienne NV 45 2,023
BERMUDA - 0.6%
Lasalle Re Holdings Ltd. 40,000 1,340,000
PartnerRe Ltd. 45,000 1,845,000
RenaissanceRe Holdings Ltd. 25,000 1,087,500
Terra Nova (Bermuda) Holdings Ltd. 205,000 5,304,375
9,576,875

SHARES VALUE (NOTE 1)
BRAZIL - 0.5%
Compania CerveJaria Brahma PN:
(Pfd. Reg.) warrants 4/30/03 (a) 188,529 $ 25,648
(Pfd. Reg.) 3,000,000 1,877,381
Petrobras PN (Pfd. Reg.) 10,000,000 1,859,242
Telebras sponsored ADR 40,000 4,060,000
7,822,271
CANADA - 7.8%
Air Canada, Inc. (a) 175,000 1,745,713
Alliance Forest Products, Inc. (a) 100,000 2,076,751
BCE, Inc. 75,000 2,090,064
Barrick Gold Corp. 375,000 7,681,316
Baton Broadcasting (a) 200,000 2,840,001
Beau Canada Exploration Ltd. (a) 500,000 1,224,751
Boralex, Inc. Class A (a) 44,600 148,830
CHC Helicopter Corp. Class A 100,000 994,001
Cambridge Shopping Centres Ltd. 165,000 1,768,966
Canadian Pacific Ltd. 200,000 5,949,803
Canadian National Railway Co. 250,000 13,490,007
Canadian Natural Resources Ltd. (a) 125,000 3,638,752
Club Monaco, Inc. (a) 100,000 1,100,501
Computalog Ltd. (a) 65,000 1,315,276
Connor Clark Ltd. Class A (non-vtg.) 150,000 1,278,001
Connor Clark Ltd. Class A (non-vtg.) (d) 50,000 426,000
Dundee Bancorp, Inc. Class A
(sub. vtg.) (a)(d) 100,000 2,627,001
Dylex Ltd. (a) 100,000 578,650
Edperbrascan Corp. Ltd., Class A (vtg.) 250,000 4,410,877
FCA International Ltd. (a) 429,800 884,959
Greenstone Resources Ltd. (a)(d) 100,000 816,500
Harrowston, Inc. Class A (a) 200,000 830,700
Hudson's Bay Co. Ord. 50,000 1,144,876
Imperial Oil Ltd. 25,000 1,554,013
International Murex Technologies
Corp. (a) 100,000 862,500
International Verifact, Inc. (a) 35,000 313,110
Journey's End Corp. (a) 250,000 1,837,126
Laurentian Bank 40,000 731,300
Marsulex, Inc. (a) 200,000 923,000
Methanex Corp. (a) 50,000 438,425
Midland Walwyn, Inc. 200,000 2,911,001
NQL Drilling Tools, Inc. Class A (a) 25,000 236,963
National Bank of Canada 1,200,000 17,082,609
Noma Industries Ltd. Class A (d) 50,000 181,050
North West Co. Fund Trust unit 100,000 994,001
PC Docs Group International, Inc. 100,000 603,500
Penn West Petroleum Ltd. (a) 50,000 612,375
Power Corporation of Canada 100,000 2,967,801
Power Financial Corp. 40,000 1,172,921
Renaissance Energy Ltd. (a) 75,000 1,741,276
Research in Motion Ltd. (a)(d) 25,000 161,525
Rio Alto Exploration Ltd. (a) 650,000 6,114,878
Royal Group Technolog Ltd.
(sub. vtg.) (a) 70,000 1,784,231
Royal Bank of Canada 50,000 2,674,926
Russel Metals, Inc. Class A (a) 250,000 931,875
Ryan Energy Technologies, Inc. (a) 25,000 228,975
St Laurent Paperboard, Inc. (a) 234,100 3,781,302
Saputo Group, Inc. (a)(d) 50,000 766,800
Southam, Inc. 50,000 985,125
Suncor, Inc. 10,000 360,325
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
CANADA - CONTINUED
Telus Corp. 100,000 $ 2,005,751
Trilon Financial Corp. Class A 350,000 2,584,401
116,605,381
DENMARK - 2.7%
Amtsspar Fyn Holding AS 5,000 347,323
BG Bank AS (Reg.) 10,000 642,273
Den Danske Bank Group AS 30,000 3,381,827
FIH AS Class B 150,000 3,770,280
Jyske Bank AS (Reg.) 100,000 10,297,814
Novo-Nordisk AS Class B 20,000 2,163,150
Syd-Sonderjylland Holding 175,000 9,063,904
Tele Danmark AS Class B 25,000 1,466,220
Unidanmark AS Class A 70,000 4,723,894
Vest-Wood AS 60,000 5,209,841
41,066,526
FINLAND - 3.3%
Cultor OY Ord., Series 2 15,000 802,278
Enso OY Class R 1,400,000 13,245,800
Finnair OY 500,000 3,861,749
Huhtamaki Ord. 50,000 2,056,382
Instrumentarium OY Class B 50,000 1,689,515
Metsa-Serla Ltd. Class B 500,000 4,441,012
Nokia Corp. AB sponsored ADR 50,000 4,412,500
Rauma OY 65,000 1,223,692
Silja OY AB Series A (a) 92,800 537,556
Spontel OY Class A 300,000 1,853,640
TT Teito OY 40,000 4,478,857
Tulikivi OY Series A 35,000 648,774
UPM-Kymmene Corp. 270,000 6,073,566
Valmet OY 300,000 4,692,026
50,017,347
FRANCE - 7.7%
Alcatel Alsthom Compagnie Generale
d'Electricite SA sponsored ADR 850,000 20,665,625
Assurances Generales (Reg.) 65,000 3,414,864
BQE National Paris Ord. 25,000 1,103,523
Carbonne-Lorraine (LE) 5,000 1,324,228
Compagnie Nationale de Navigation (a) 2,607 57,086
Companie Generale de
Geophysique SA (a) 170,000 4,760,000
Credit Commercial de France Ord. 100,000 5,656,964
Elf Aquitaine SA sponsored ADR 200,000 12,350,000
Eurafrance (Societe) 12,000 4,879,391
France Telecom SA 100,000 3,778,811
Immobiliere Marseillaise, ste, Class B 1,255 1,681,458
LVMH (Moet-Hennessy Louis Vuitton)
sponsored ADR 10,000 1,696,397
Lagardere S.C.A. (Reg.) 75,491 2,167,919
Marine Wendel SA 30,000 3,448,186
Michelin SA (Compagnie Generale
des Etablissements) Class B 50,663 2,594,999
Pernod-Ricard 150,000 6,940,514
Paribas SA (Cie Financiere) Class A 30,000 2,175,369
Rhone Poulenc SA Class A 35,000 1,523,728
Scor SA 150,000 6,956,093
Societe Generale Class A 75,000 10,256,277
Total SA Class B 100,000 11,078,510
Union Assurancesfederale SA 60,406 6,744,367
115,254,309

SHARES VALUE (NOTE 1)
GERMANY - 3.2%
Adidas AG 10,000 $ 1,449,275
Andrea-Noris Zahn 45,000 1,794,783
BASF AG 200,000 6,828,986
Bayer AG 100,000 3,524,638
BERU AG 24,500 518,406
Berlinger Bank AG 50,000 1,236,232
Buderus AG 10,000 4,846,377
Commerzbank AG 150,000 5,079,130
Deutsche Bank AG 70,000 4,599,710
Depfa Bank (Deut Pfandbrief) 100,000 5,681,159
Metallgesellschaft AG Ord. (a) 100,000 2,005,797
Pfeiffer Vacuum Technology AG
sponsored ADR (a) 30,000 975,000
Phoenix AG 10,000 185,507
SAP (Systeme Anwendungen
Produkte) AG 5,000 1,436,232
Springer Axel Verlag AG (Reg.) 2,500 2,079,710
Thyssen AG Ord. 10,000 2,318,841
Veba AG Ord. 60,000 3,347,826
47,907,609
HONG KONG - 0.2%
Peregrine Investments Holdings Ltd. 2,000,000 1,966,365
Vtech Holdings Ltd. 377,000 736,442
2,702,807
INDIA - 0.0%
Tata Engineering & Locomotive Ltd.
GDR (d) 45,000 445,500
INDONESIA - 0.1%
Asia Pulp & Paper Co. Ltd.
sponsored ADR 100,000 1,137,500
PT Kawasan Industri Jababeka 145,000 60,417
Indosat (Indonesia Satellite)
sponsored ADR 15,000 355,313
PT Bank PAN Indonesia (For. Reg.) 660 147
PT Kawasan Industri Jababeka 55,000 22,917
PT Putra Surya Multidana (a) 400,000 138,889
1,715,183
IRELAND - 0.8%
Anglo-Irish Bank Corp. PLC 2,000,000 3,347,000
Bank of Ireland, Inc. 100,000 1,254,754
Elan Corp. PLC ADR (a) 20,000 997,500
FBD Holdings PLC 50,000 225,405
Hibernian Group PLC 250,000 1,615,403
IAWS Group PLC Class A (Reg.) 70,000 257,719
IWP International (UK Reg.) 100,000 468,580
Independent Newspapers PLC 271,053 1,474,223
Irish Life PLC 200,000 1,060,999
Jurys Hotel Group PLC (UK) 151,692 939,269
Ryan Hotels Ltd. 1,000,000 886,955
12,527,807
ISRAEL - 0.2%
Dead Sea Bromine Co. 10,000 74,617
Edusoft Ltd. (a) 30,000 228,750
Galileo Technology Ltd. 10,000 343,750
Koor Industries Ltd. sponsored ADR 50,000 1,068,750
RIT Technologies Ltd. 15,000 180,000
Teva Pharmaceutical Industries Ltd. ADR 3,000 140,250
TTI Team Telecom International Ltd. 50,000 287,500
2,323,617
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
ITALY - 1.6%
Aeroporti di Roma Spa (a) 51,000 $ 463,798
Credito Italiano Ord. 2,000,000 5,353,207
Eni Spa sponsored ADR 20,000 1,127,500
Instrumentation Laboratory
sponsored ADR 300,000 750,000
Manuli Rubber Industries Spa (a) 50,000 185,242
Montedison Spa Ord. 8,000,000 6,472,987
SAES Getters Spa sponsored ADR 110,500 1,201,688
Telecom Italia Spa 1,133,330 7,088,372
Telecom Italia Mobile Spa 600,000 2,214,754
24,857,548
JAPAN - 14.4%
Acom Co. Ltd. 100,000 5,481,728
Aoyama Trading Co. Ord. 80,000 2,146,179
Aronkasei Co. Ltd. 25,000 93,854
Bunka Shutter Co. Ltd. 150,000 554,402
Canon, Inc. 300,000 7,275,748
Chiyoda Fire & Marine Insurance Co. Ltd. 600,000 2,177,741
Chubu Steel Plate Co. Ltd. 275,000 696,636
Citizen Watch Co. Ltd. Ord. 500,000 3,189,369
Dai-Tokyo Fire & Marine Insurance Ord. 200,000 857,143
Daiichi Pharmaceutical Co. Ltd. 250,000 3,550,665
Denyo Co. Ltd. 25,000 133,929
Diamond City Co. Ltd. 25,000 99,668
Enix Corp. 50,000 1,038,206
Fuji Photo Film Co. Ltd. 250,000 9,053,156
Fujitsu Ltd. 300,000 3,289,037
Fuji Fire & Marine Insurance Co. Ltd. 500,000 1,594,684
Fukushima Industries Corp. 5,000 52,326
Fujitsu Business Systems Ltd. 50,000 1,021,595
Hibiya Engineering Ltd. 30,000 153,239
Higashi Nihon House Co. Ltd. 100,000 747,508
Hitachi Ltd. 1,000,000 7,682,724
Honda Motor Co. Ltd. 100,000 3,363,787
Isewan Terminal Service Co. Ltd. 11,000 30,972
Jafco Co. Ltd. 120,000 5,681,063
Jamco Corp. 95,000 1,080,980
Japan Tobacco, Inc. 300 2,459,302
Kanamoto Co. Ltd. 10,000 47,259
Kao Corp. 300,000 4,186,047
Kawagishi Bridge Works Co. Ltd. 150,000 438,538
Katsuragawa Electric Co. 10,000 41,611
Komatsu Ltd. Ord. 500,000 2,670,266
Konica Corp. 300,000 1,495,017
Konami Industry Co. Ltd. 75,000 2,304,817
Konishi Co. Ltd. 10,000 132,890
Kuraya Corp. 10,000 88,040
Kuwazawa Trading Co. Ltd. 10,000 49,003
Long Term Credit Bank of Japan Ltd. (The) 400,000 1,352,159
Maezawa Kasei Industries Co. Ltd. 10,000 137,043
Makita Corp. 100,000 1,403,655
Maruzen Showa Unyu Co. Ltd. 225,000 627,907
Matsushita Electric Industrial Co. Ltd. (a) 650,000 10,905,316
Matsushita Communication
Industrial Co. Ltd. 200,000 7,059,801
Matsushita Electric Works Co. Ltd. 100,000 905,316
Minebea Co. Ltd. 700,000 6,976,744
Minolta Camera Co. Ltd. 300,000 1,557,309
Misawa Homes 100,000 382,890
Mitsubishi Estate Co. Ltd. 150,000 1,893,688

SHARES VALUE (NOTE 1)
Mitsubishi Heavy Industries Ltd. 250,000 $ 1,227,160
Mitsui Home Co. Ltd. 50,000 322,259
Mitsui Wood Systems, Inc. 25,000 113,164
Murakami Corp. 15,000 80,980
Namco Ltd. 100,000 3,347,176
Nagawa Co. Ltd. 5,000 23,879
Nintendo Co. Ltd. Ord. 125,000 10,797,342
Nippon Telegraph & Telephone
Corp. Ord. 600 5,083,057
Nishio Rent All Co. Ltd. Ord. 20,000 189,369
Nittetsu Mining Co. Ltd. 200,000 1,119,601
Nitto Denko Corp. 100,000 1,802,326
Nomura Securities Co. Ltd. 150,000 1,744,186
NTT Data Communications System 40 1,910,299
Nichicon Corp. 200,000 2,475,083
Nissho Corp. 100,000 817,276
Okura & Co. Ltd. (a) 10,000 27,907
Omron Corp. 150,000 2,541,528
Promise Co. Ltd. 55,000 3,215,947
Ricoh Co. Ltd. Ord. 250,000 3,218,439
Ricoh Leasing Co. Ltd. 28,000 339,535
Riken Vitamin Oil Co. Ltd. 143,000 1,306,478
Royal Co. Ltd. 100,000 1,744,186
SXL Corp. 35,000 130,814
Sangetsu Company Ltd. 100,000 1,619,601
Sankyo Co. Ltd. 100,000 3,297,342
Sekisui House Ltd. 350,000 2,994,186
Senshukai Co. Ltd. 100,000 639,535
Sankyo Co. Ltd. (Gunma) 70,000 1,494,186
Senshu Electric Co. Ltd. 10,000 67,276
Shiseido Co. Ltd. 100,000 1,362,126
Shinko Kogyo Co. Ltd. 50,000 163,621
Snow Brand Seed Co. Ltd. 6,000 28,904
Sony Corp. 160,000 13,275,748
Sotoh Co. Ltd. 50,000 299,003
Sonton Food Industry Co. Ltd. 20,000 189,369
Sumitomo Marine and Fire Insurance
Co. Ltd. 900,000 5,995,017
Sumitomo Metal Industries Ltd. 200,000 400,332
TDK Corp. 20,000 1,657,807
THK Co. Ltd. 60,000 802,326
Takeda Chemical Industries Ltd. 300,000 8,172,758
Taihei Dengyo Kaisha Ltd. 22,000 101,412
Takeda Printing Co. Ltd. 10,000 56,478
Takefuji Corp. 100,000 4,443,522
Terumo Corp. 100,000 1,644,518
Tokio Marine & Fire Insurance Co.
Ltd. (The) 600,000 5,980,067
Toyota Motor Corp. 125,000 3,477,990
Topcon Corp. 10,000 44,767
Tsuchiya Home Co. Ltd. 35,000 188,953
Wakita & Co. Ltd. 25,000 158,015
Yasuda Fire & Marine Insurance Co. 600,000 3,323,920
Yasuda Trust & Banking 900,000 2,399,502
Yokogawa Electric 150,000 953,073
216,970,302
KOREA (SOUTH) - 0.5%
Korea Electric Power Corp. 70,000 993,782
Nam Yang Dairy Products 35,000 3,409,325
Pohang Iron & Steel Co. Ltd. 5,000 219,171
SK Telecom Ltd. 6,074 1,875,701
Samsung Electronics Co. Ltd. (vtg.) 9,616 377,665
6,875,644
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
LIECHTENSTEIN - 0.2%
Liechtenstein Global Trust AG
participation certificate 4,550 $ 2,277,440
LUXEMBOURG - 0.1%
Espirito Santo Financial Holding SA ADR 60,000 1,237,500
Quilmes Industrial SA sponsored ADR 50,000 618,750
1,856,250
MALAYSIA - 0.0%
Oriental Holdings BHD 225,000 456,716
Oriental Holdings BHD (New) 135,000 270,604
727,320
MEXICO - 0.6%
Corporacion Geo SA de CV (a) 500,000 2,696,897
Grupo Financiero Bancomer Class B (a) 3,500,000 1,649,761
Grupo Financiero Inbursa SA Class B 600,000 2,112,172
Grupo Industrial Durango SA
de CV ADR (a) 30,000 390,000
Grupo Mexico SA, Class L 612,000 1,811,169
8,659,999
NETHERLANDS - 4.5%
ABN-AMRO Holdings NV 180,000 3,618,509
AKZO Nobel NV 60,000 10,553,213
Core Laboratories NV (a) 5,000 200,000
DOCdata NV (a) 85,000 1,542,674
Gucci Group NV 10,000 363,750
ING Groep NV 120,000 5,028,278
KLM Royal Dutch Air Lines NV 30,000 1,014,910
Koninklijke Hoogovens NV 50,000 2,287,918
Koninklijke Pakhoed NV 50,000 1,634,961
New Holland NV 80,000 2,275,000
Philips Electronics NV (Bearer) 50,000 3,907,455
Royal Dutch Petroleum Co. 100,000 5,262,500
Royal Ptt Nederland NV 250,000 9,537,275
Scala Business Solutions NV (a) 39,200 303,713
Scala Business Solutions NV
warrants 3/31/01 (a) 25,000 41,212
Smit International NV 70,000 2,195,373
Telegraaf 100,000 2,056,555
Unilever NV ADR 250,000 13,343,750
Van Ommeren Ceteco NV 25,000 893,316
Vedior NV 40,000 820,566
66,880,928
NEW ZEALAND - 0.8%
Air New Zealand Ltd. Class B 1,284,100 2,716,270
Brierley Investments Ltd. 900,000 694,319
Corporate Investments Ltd. (a) 950,000 531,938
CUE Energy Resources NL (Astl.) (a) 160,000 20,190
Fletcher Challenge Ltd. (Energy Division) 450,000 2,015,766
Fletcher Challenge Ltd. (Forestry Division) 500,000 482,166
Independent Newspapers Ltd. 292,000 1,526,010
Lion Nathan Ltd. 1,400,000 3,379,519
Progressive Enterprises Ltd. 500,000 544,381
11,910,559
NORWAY - 3.4%
Benor Tankers 134,000 1,088,313
Color Lines 300,000 1,303,753
Den Norske Bank AS Class A
Free shares 1,300,000 5,853,353

SHARES VALUE (NOTE 1)
Det Sondenfjelds-Norske
Dampskibsselskab, Class A (a)(d) 75,000 $ 1,677,781
Frontline Ltd. (a) 750,000 3,772,335
Ganger Rolf 5,000 345,530
Helikopter Services AS 50,000 619,817
Merkantildata 150,000 5,022,655
Fred Olsen Energy ASA (a) 19,000 476,475
P4 Radio Hele Norge SA 50,000 463,082
Petroleum Geo-Services AS
sponsored ADR (a) 25,000 1,731,250
Procon Offshore ASA (a) 50,000 616,255
Saga Petroleum AS Class B 49,300 871,050
Saevik Supply AS (a) 450,000 10,259,041
Smedvig AS 50,000 1,503,234
Schibsted AS:
Series B 550,000 10,266,165
Class B (d) 50,000 933,288
Storli Skibs AS:
Series A 10,000 227,979
Class B (non-vtg.) 110,800 2,447,066
Superoffice AS (a) 100,000 256,476
Tandberg Television ASA 100,000 933,288
Wilhelmsen (Wilh.) Ltd. AS 5,000 242,227
50,910,413
PERU - 0.1%
Banco Wiese Ltd. sponsored ADR 125,000 695,313
Telefonica Del Peru SA Class B
sponsored ADR 35,000 691,250
1,386,563
PORTUGAL - 1.0%
Electricidade de Portugal SA 150,000 2,630,534
Portugal Telecom SA 79,000 3,234,875
Telecel Comunicacoes Pessoais SA 100,000 9,023,837
14,889,246
RUSSIA - 0.2%
Luk Oil Co. sponsored ADR 35,000 2,905,000
SINGAPORE - 0.0%
Singapore Bus Service 1978 Ltd.
(For. Reg.) 150,000 586,459
Times Publishing Ltd. 38,000 67,248
653,707
SOUTH AFRICA - 0.9%
Anglo American Corp. of South Africa
Ltd. (Reg.) 50,000 2,159,917
Free State Consolidated Gold Mines
Ltd. Ord. 400,000 2,039,460
Gencor Ltd. (Reg.) 200,000 448,598
Ingwe Coal Corp. Ltd. 50,000 197,300
South African Breweries Ltd. 150,000 3,987,539
Vaal Reefs Exploration & Mining Co.
Ltd. (Reg.) 55,000 2,371,340
Vaal Reefs Exploration & Mining Co.
Ltd. ADR (New) 200,000 862,500
Western Deep Levels Ltd. Ord. 48,000 996,885
13,063,539
SPAIN - 1.0%
Argentaria Corporacion Bancaria
de Espana SA 75,000 4,156,093
Banco Bilbao Vizcaya SA Ord. (Reg.) 30,000 800,357
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
SPAIN - CONTINUED
Banco De Santander SA de Credito ADR 40,000 $ 1,087,500
Endesa SA sponsored ADR 80,000 1,490,000
Repsol SA sponsored ADR 20,000 850,000
Telefonica de Espana SA sponsored ADR 50,000 4,112,500
Union Electrica Fenosa SA 200,000 1,906,591
14,403,041
SWEDEN - 4.3%
Astra AB Class A Free shares 300,000 4,828,733
Atle AB 150,000 2,254,739
Custos AB, Class B 50,000 1,057,532
Ericsson (L.M.) Telephone Co. Class B
ADR 60,000 2,655,000
Forvaltnings AB Ratos Class B
Free shares 500,000 4,423,013
Hemkopskedjan AB Series B (a) 300,000 3,092,783
Investor AB Class B Free shares 80,000 3,714,001
Karlshamns AB (a) 197,800 2,683,818
Linjebuss AB Class A 50,000 399,069
Mo Och Domsjoe AB Class B 160,000 4,320,585
NK Cityfastigheter AB (a) 200,000 1,489,857
Netcom Systems AB Class B (a) 300,000 5,008,314
Nordbanken AB 50,000 1,563,020
Prosolvia AB Class B (a) 40,000 1,372,797
SKF AB Ord. 270,000 6,249,418
Scania AB:
Class A 75,000 1,805,786
Class B 100,000 2,454,273
Skandinaviska Enskilda Banken Class A
Free shares 100,000 1,077,486
Skandia Foersaekrings AB 50,000 2,327,902
Swedish Match Co. 1,800,000 5,507,150
Trelleborg Class B Free shares (a) 40,000 526,771
Volvo AB Class B 100,000 2,607,250
WM Data Nordic AB, Series B 150,000 2,593,947
64,013,244
SWITZERLAND - 4.6%
Bank for International Settlements 500 3,512,692
Bucher Holding AG (Bearer) 2,000 1,889,167
Ciba Specialty Chemicals AG (a) 10,000 983,196
Credit Suisse Group (Reg.) 86,300 12,172,095
Edipresse SA, Lausanne 10,000 2,788,702
Jelmoli, Grands Magasins SA 2,000 1,744,726
Julius Baer Holding AG 5,000 7,472,292
Nestle SA (Reg.) 9,000 12,697,176
Novartis AG (Reg.) 14,000 21,953,522
Publicitas Holding SA (Reg.) 10,000 2,180,908
Sarna Kunststoff Holding AG 1,260 1,540,651
Usego Hofer Curti AG (Reg.) 500 97,962
69,033,089
THAILAND - 0.0%
I.C.C. International PCL (Local Reg.) 4,500 7,678
PTT Exploration & Production (For. Reg.) 40,000 399,756
Sri Thai Superware Co. Ltd. (For. Reg.) 50,000 14,016
421,450
UNITED KINGDOM - 10.1%
Allied Domecq PLC 200,000 1,628,316
Anglian Water PLC Ord. 200,000 2,680,947
Appleyard Group 100,000 125,513
Asda Group PLC 1,000,000 2,593,925

SHARES VALUE (NOTE 1)
BAA PLC Ord. 200,000 $ 1,840,850
BAT Industries PLC Ord. 700,000 6,092,007
BTP PLC 300,000 1,686,888
Barclays PLC Ord. 200,000 4,997,071
Biocompatibles International PLC
Class L (a) 200,000 1,907,790
British Petroleum PLC ADR 14,247 1,250,174
British Vita Ord. 100,000 404,987
Budgens PLC 500,000 460,213
Doncasters PLC sponsored ADR 143,900 3,876,306
English China Clay PLC 600,000 2,610,660
Gallaher Group PLC sponsored ADR 450,000 8,634,375
Gentia Software PLC sponsored ADR (a) 45,000 129,375
Granada Group PLC 100,000 1,375,617
Grand Metropolitan PLC 350,000 3,151,201
Guinness PLC Ord. 350,000 3,121,914
HSBC Holdings PLC 175,200 4,104,761
House of Fraser PLC Class L 1,000,000 3,598,025
Hyder PLC 300,000 4,518,450
International Business Communications
Holdings PLC Class L 400,000 2,744,540
Intrum Justitia NV (Reg.) 1,000,000 1,221,655
London Pacific Group Ltd. (a) 550,000 1,932,893
Mcbride PLC 800,000 2,316,124
National Grid Co. PLC 1,000,000 4,702,535
National Power PLC (d) 150,000 1,247,594
National Westminster Bank PLC Ord. 400,000 5,736,758
Paterson Zochonis 200,000 1,255,125
Powergen PLC Ord. 150,000 1,664,296
RJB Mining PLC 500,000 1,497,783
Railtrack PLC Class L 75,000 1,196,134
Rentokil Initial PLC 500,000 1,966,363
Royal & Sun Alliance Insurance
Group PLC 700,000 6,694,837
Safeway PLC 308,137 2,002,078
Scottish Power PLC ADR 300,000 2,234,123
Shell Transport & Trading Co. PLC (Reg.) 2,500,000 17,686,807
Severn Trent PLC 142,500 2,060,413
SmithKline Beecham PLC ADR 150,000 7,143,750
Stakis PLC 650,000 1,044,264
Thames Water PLC Ord. 200,000 3,029,035
Tomkins PLC Ord. 1,250,000 6,401,138
Unilever PLC ADR 200,000 6,050,000
Vaux Group PLC 200,000 803,280
Vodafone Group PLC sponsored ADR 40,000 2,195,000
WPP Group PLC 800,000 3,641,536
Whitbread & Co. PLC Class A 150,000 2,000,669
151,258,095
UNITED STATES OF AMERICA - 0.3%
Orthofix International NV (a) 393,000 5,305,500
TOTAL COMMON STOCKS
(Cost $1,047,484,220) 1,197,201,350
CLOSED-END INVESTMENT COMPANIES - 7.9%
AUSTRALIA - 0.0%
First Australia Fund, Inc. 50,000 371,875
AUSTRIA - 0.2%
Austria Fund, Inc. 350,000 3,325,000
CLOSED-END INVESTMENT COMPANIES - CONTINUED
SHARES VALUE (NOTE 1)
BRAZIL - 0.2%
Brazil Fund, Inc. 160,000 $ 3,450,000
CANADA - 0.6%
Canadian General Investment Ltd. 177,619 2,112,335
Economic Investment Trust Ltd. 58,100 4,288,044
United Corporations Ltd. 75,000 2,609,251
9,009,630
CHILE - 0.1%
Five Arrows Chile Investment Trust Ltd. 500,000 1,365,000
CHINA (PEOPLES REP.) - 0.1%
China Fund, Inc. 55,000 732,188
EMERGING MARKETS - 1.6%
Central European Equity Fund 180,000 4,162,500
Emerging Markets Telecommunication
Fund, Inc. 112,900 1,799,344
Emerging Markets Infrastructure
Fund, Inc. 480,000 5,640,000
Latin America Growth Fund, Inc. 65,000 650,000
Morgan Stanley Africa Investment
Fund, Inc. 80,000 1,220,000
New South Africa Fund, Inc. 25,000 325,000
Scudder New Europe Fund, Inc. 168,200 2,607,100
Southern Africa Fund, Inc. 75,000 1,190,625
TCW/DW Emerging Markets
Opportunities Trust (SBI) 140,000 1,741,250
Templeton Dragon Fund, Inc. 350,000 4,484,375
23,820,194
FRANCE - 0.3%
France Growth Fund, Inc. 460,000 5,088,750
GERMANY - 1.0%
Emerging Germany Fund, Inc. 420,000 4,462,500
New Germany Fund, Inc. (The) 729,800 10,901,388
15,363,888
HONG KONG - 0.2%
Asia Pacific Fund, Inc. 200,000 1,700,000
Greater China Fund, Inc. 30,000 453,750
2,153,750
INDIA - 0.2%
India Fund 200,000 1,650,000
India Growth Fund, Inc. 50,000 512,500
Jardine Fleming India Fund, Inc. (a) 100,000 800,000
2,962,500
ISRAEL - 0.0%
First Israel Fund, Inc. 52,000 676,000
ITALY - 0.1%
Italy Fund, Inc. (The) 100,000 950,000
MEXICO - 0.6%
Emerging Mexico Fund, Inc. 100,000 918,750
Mexico Equity & Income Fund 81,500 1,034,031
Mexico Fund, Inc. (The) 400,000 7,475,000
9,427,781
MULTI-NATIONAL - 1.2%
Americas Income Trust, Inc. 110,000 907,500
Asia Tigers Fund, Inc. 400,000 3,175,000
Blackrock North American Government
Income Trust, Inc. 350,000 3,718,750
Clemente Global Growth Fund, Inc. 50,000 465,625

SHARES VALUE (NOTE 1)
Fleming Natural Resources Investment
Trust PLC 75,000 $ 107,941
INVESCO Global Health Sciences Fund 70,000 1,211,875
MFS Government Markets Income Trust 500,000 3,343,750
Morgan Stanley Asia-Pacific Fund, Inc. 375,000 3,023,438
Royce Global Trust, Inc. (a) 83,500 474,906
Schroder Asian Growth Fund, Inc. 40,000 340,000
Scudder Spain Portugal Fund, Inc. 10,000 133,750
Strategic Global Income Fund, Inc. 150,000 1,753,125
18,655,660
PORTUGAL - 0.2%
Portugal Fund, Inc. 158,900 2,681,438
SPAIN - 0.7%
Growth Fund of Spain, Inc. 500,000 7,750,000
Spain Fund, Inc. 218,900 3,091,963
10,841,963
SWITZERLAND - 0.1%
Swiss Helvetia Fund, Inc. 52,200 1,246,275
TAIWAN - 0.5%
R.O.C. Taiwan Fund (SBI) 40,000 347,500
Taiwan Equity Fund, Inc. (a) 135,000 1,350,000
Taiwan Fund, Inc. 300,000 5,437,500
7,135,000
TOTAL CLOSED-END INVESTMENT COMPANIES
(Cost $115,767,940) 119,256,892
PREFERRED STOCKS - 2.4%
CONVERTIBLE PREFERRED STOCKS - 0.6%
AUSTRALIA - 0.4%
National Australia Bank Ltd. 7.8750% 200,000 5,562,500
UNITED STATES OF AMERICA - 0.2%
WBK STRYPES Trust $3.135 100,000 3,100,000
TOTAL CONVERTIBLE PREFERRED STOCKS 8,662,500
NONCONVERTIBLE PREFERRED STOCKS - 1.8%
AUSTRIA - 0.1%
Bank Austria AG (non-vtg.) 21,500 1,010,097
Miba Holdings AG, Class B 15,000 773,954
1,784,051
GERMANY - 0.3%
Volkswagen AG 10,000 4,585,507
ITALY - 0.2%
Telecom Italia Spa 800,000 3,221,374
PORTUGAL - 0.1%
Lusomundo (Filmes) SA (non vtg.) 133,300 1,128,738
UNITED STATES OF AMERICA - 1.1%
Freeport McMoran Copper & Gold, Inc.:
Series B 200,000 5,625,000
depositary shares representing 0.025
shares silver denomination 300,500 5,521,688
depositary shares representing gold,
Series II 200,000 5,475,000
16,621,688
TOTAL NONCONVERTIBLE PREFERRED STOCKS 27,341,358
TOTAL PREFERRED STOCKS
(Cost $34,244,404) 36,003,858
CORPORATE BONDS - 0.5%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) AMOUNT (C) (NOTE 1)
FINLAND - 0.3%
Metsa Serla OY 4 3/8%,
10/15/02 (d) - $ 5,000,000 $ 4,850,000
LUXEMBOURG - 0.1%
Espirito Santo Financial Holding
SA 8 3/4%, 4/10/03 - XEU 1,000,000 1,417,320
NETHERLANDS - 0.1%
Bilbao Vizcaya Investments BV
3 1/2%, 7/12/06 Aa3 1,000,000 1,670,000
TOTAL CORPORATE BONDS
(Cost $7,769,136) 7,937,320
CASH EQUIVALENTS - 9.5%
SHARES
Taxable Central Cash Fund (b)
(Cost $142,514,594) 142,514,594 142,514,594
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,347,780,294) $ 1,502,914,014
CURRENCY ABBREVIATIONS
XEU - European currency unit
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Principal amount is stated in United States dollars unless
otherwise noted.
(d) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$23,526,580 or 1.6% of net assets.
(e) Affiliated company (see Note 7 of Notes to Financial Statements).
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $1,430,243,491 and $819,114,253, respectively (see Note 3
of Notes to Financial Statements).
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of Fidelity Management & Research Company.
The commissions paid to these affiliated firms were $249,043 for the
period (see Note 4 of Notes to Financial Statements).
Transactions during the period with companies which are or were
affiliates are as follows:
PURCHASES SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
Vae AG $ - $ - $ - $ 7,356,274

INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $1,350,005,983. Net unrealized appreciation
aggregated $152,908,031, of which $219,372,990 related to appreciated
investment securities and $66,464,959 related to depreciated
investment securities.
The fund hereby designates approximately $24,554,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.4%
Basic Industries 6.8
Cash Equivalents 9.5
Construction & Real Estate 1.6
Durables 5.2
Energy 6.4
Finance 28.5
Health 4.8
Holding Companies 1.5
Industrial Machinery & Equipment 3.5
Media & Leisure 3.7
Nondurables 7.6
Precious Metals 1.1
Retail & Wholesale 1.4
Services 0.7
Technology 5.7
Transportation 4.5
Utilities 7.1
100.0%
DIVERSIFIED INTERNATIONAL
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

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OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE (COST $1,347,780,294) - SEE ACCOMPANYING SCHEDULE $ 1,502,914,014

CASH 525,008

RECEIVABLE FOR INVESTMENTS SOLD 44,523,798

RECEIVABLE FOR FUND SHARES SOLD 14,672,416

DIVIDENDS RECEIVABLE 3,225,867

INTEREST RECEIVABLE 742,623

OTHER RECEIVABLES 12,159

TOTAL ASSETS 1,566,615,885

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 40,307,277

PAYABLE FOR FUND SHARES REDEEMED 10,172,161

ACCRUED MANAGEMENT FEE 1,076,086

OTHER PAYABLES AND 733,295
ACCRUED EXPENSES

TOTAL LIABILITIES 52,288,819

NET ASSETS $ 1,514,327,066

NET ASSETS CONSIST OF:

PAID IN CAPITAL $ 1,286,021,067

UNDISTRIBUTED NET INVESTMENT INCOME 14,787,511

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN 58,357,025
CURRENCY TRANSACTIONS

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 155,161,463
AND ASSETS AND LIABILITIES IN FOREIGN CURRENCIES

NET ASSETS, FOR 91,363,356 $ 1,514,327,066
SHARES OUTSTANDING

NET ASSET VALUE, OFFERING PRICE $16.57
AND REDEMPTION PRICE PER SHARE ($1,514,327,066 (DIVIDED BY) 91,363,356 SHARES)

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STATEMENT OF OPERATIONS

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YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 23,561,382
DIVIDENDS

SPECIAL DIVIDEND FROM GENCOR LTD. 3,743,595

INTEREST 5,208,655

32,513,632

LESS FOREIGN TAXES WITHHELD (2,408,574)

TOTAL INCOME 30,105,058

EXPENSES

MANAGEMENT FEE $ 8,221,856
BASIC FEE

PERFORMANCE ADJUSTMENT 954,599

TRANSFER AGENT FEES 3,002,618

ACCOUNTING FEES AND EXPENSES 603,478

NON-INTERESTED TRUSTEES' COMPENSATION 4,886

CUSTODIAN FEES AND EXPENSES 508,136

REGISTRATION FEES 326,387

AUDIT 54,201

LEGAL 7,502

REPORTS TO SHAREHOLDERS 182,790

MISCELLANEOUS 10,773

TOTAL EXPENSES BEFORE REDUCTIONS 13,877,226

EXPENSE REDUCTIONS (254,469) 13,622,757

NET INVESTMENT INCOME 16,482,301

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 60,627,965

FOREIGN CURRENCY TRANSACTIONS (147,765) 60,480,200

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 84,832,063

ASSETS AND LIABILITIES IN 30,538 84,862,601
FOREIGN CURRENCIES

NET GAIN (LOSS) 145,342,801

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 161,825,102

OTHER INFORMATION $ 197,962
EXPENSE REDUCTIONS
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 2,246

TRANSFER AGENT CREDITS 54,261

$ 254,469

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

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OPERATIONS $ 16,482,301 $ 7,321,339
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 60,480,200 27,040,980

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 84,862,601 39,551,272

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 161,825,102 73,913,591

DISTRIBUTIONS TO SHAREHOLDERS (7,278,518) (5,256,708)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (17,468,122) (9,796,447)

TOTAL DISTRIBUTIONS (24,746,640) (15,053,155)

SHARE TRANSACTIONS 1,829,687,888 791,836,282
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 24,250,333 14,593,828

COST OF SHARES REDEEMED (1,142,181,507) (494,815,255)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 711,756,714 311,614,855

TOTAL INCREASE (DECREASE) IN NET ASSETS 848,835,176 370,475,291

NET ASSETS

BEGINNING OF PERIOD 665,491,890 295,016,599

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $14,787,511 AND
$6,896,785, RESPECTIVELY) $ 1,514,327,066 $ 665,491,890

OTHER INFORMATION
SHARES

SOLD 113,844,123 58,603,680

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,681,716 1,169,376

REDEEMED (70,452,524) (36,651,694)

NET INCREASE (DECREASE) 45,073,315 23,121,362

</TABLE>

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SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>
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FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 C 1993

</TABLE>

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NET ASSET VALUE, BEGINNING OF PERIOD $ 14.38 $ 12.73 $ 12.46 $ 11.32 $ 8.46

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .24 B, F .15 .22 .05 .07

NET REALIZED AND UNREALIZED GAIN (LOSS) 2.46 2.13 .47 1.20 2.89

TOTAL FROM INVESTMENT OPERATIONS 2.70 2.28 .69 1.25 2.96

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.15) (.22) (.03) (.01) (.10)

FROM NET REALIZED GAIN (.36) (.41) (.39) (.10) -

TOTAL DISTRIBUTIONS (.51) (.63) (.42) (.11) (.10)

NET ASSET VALUE, END OF PERIOD $ 16.57 $ 14.38 $ 12.73 $ 12.46 $ 11.32

TOTAL RETURN A 19.30% 18.66% 6.02% 11.14% 35.38%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 1,514,327 $ 665,492 $ 295,017 $ 351,152 $ 255,029

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.25% 1.29% 1.13% 1.25% 1.47%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.23% D 1.27% D 1.12% D 1.25% 1.47%

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.49% 1.53% 1.55% .96% .84%

PORTFOLIO TURNOVER RATE 81% 94% 101% 89% 56%

AVERAGE COMMISSION RATE E $ .0153 $ .0121

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO
FINANCIAL STATEMENTS). B NET INVESTMENT INCOME PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE SHARES
OUTSTANDING DURING THE PERIOD. C EFFECTIVE NOVEMBER 1, 1993, THE
FUND ADOPTED STATEMENT OF POSITION 93-2, "DETERMINATION,
DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT
COMPANIES." AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY
REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX
DIFFERENCES. D FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE
FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS).
E FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND
IS REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR
SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED.
THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING
ON THE MIX OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING
PRACTICES AND COMMISSION RATE STRUCTURES MAY DIFFER. F INVESTMENT
INCOME PER SHARE REFLECTS A SPECIAL DIVIDEND
FROM GENCOR LTD. WHICH AMOUNTED TO $.05 PER SHARE.

</TABLE>

INTERNATIONAL VALUE
PERFORMANCE: THE BOTTOM LINE

INTERNATIONAL VALUE 13.20% 31.93%

MORGAN STANLEY CAPITAL 4.82% 15.53%
INTERNATIONAL EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1994. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Morgan Stanley Capital International (MSCI) Europe,
Australasia, Far East (EAFE) Index - a market capitalization weighted,
unmanaged index of over 1,000 foreign stocks. To measure how the
fund's performance stacked up against its peers, you can compare it to
the international funds average, which reflects the performance of
mutual funds with similar objectives tracked by Lipper Analytical
Services, Inc. The past one year average represents a peer group of
406 mutual funds. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

INTERNATIONAL VALUE 13.20% 9.68%

MORGAN STANLEY CAPITAL 4.82% 4.93%
INTERNATIONAL EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% N/A

An interview with Richard Mace, Portfolio Manager of Fidelity
International Value Fund
Q. HOW DID THE FUND PERFORM, RICK?
A. Quite well. For the 12 months that ended October 31, 1997, the fund
generated a total return of 13.20%. For the same period, the Morgan
Stanley Capital International Europe, Australasia, Far East (EAFE)
Index returned 4.82%. The international funds average, as tracked by
Lipper Analytical Services, returned 10.39% over the same time period.
Q. WHAT FACTORS CONTRIBUTED MOST TO THE FUND'S PERFORMANCE?
A. The fund's European finance-related stocks provided a significant
performance boost, as did substantial exposure to the technology,
energy and health care sectors. Another plus was the fund's limited
exposure - relative to the EAFE index - in the poorly performing
Japanese market. All that being said, individual stock picking
continued to have the most influence on performance. In general, the
fund's 20 largest positions performed well.
Q. YOU MENTIONED FINANCE-RELATED STOCKS AS BEING POSITIVE CONTRIBUTORS
TO PERFORMANCE. WHAT DROVE THIS GROUP?
A. While I don't spend a lot of time analyzing interest rates,
inflation levels or economic conditions, low interest rates throughout
Europe were beneficial to many of the fund's top finance stocks. More
importantly, though, many of these companies fit the profile I was
looking for - management was focused on delivering results to
shareholders, the company was generating strong earnings growth and
each had a healthy balance sheet. Examples included Spanish bank Banco
Bilbao Vizcaya, Switzerland's Credit Suisse and Lloyds TSB Group in
the United Kingdom. Each of these positions performed quite well.
Q. WHAT ATTRACTED YOU TO ENERGY-RELATED STOCKS?
A. I don't spend a lot of time analyzing the direction of oil prices
or whether current oil price levels are justified. Rather, I look at
individual stocks. During the period, it just so happened that many
promising stocks happened to be oil producers. Several of the fund's
largest holdings - including Shell Transport & Trading Co. and British
Petroleum in the United Kingdom, France-based Total and Nationale Elf
Aquitaine, and Royal Dutch Petroleum in the Netherlands - encapsulated
many of the characteristics I search for in a good buying opportunity.
Each is typically very well-run, with an emphasis on creating value
for shareholders, generating healthy cash flows and slashing expenses.
Elf Aquitaine and Total are interesting stories. Our research team
found these companies to be particularly attractive despite their
markedly different production profiles. Elf Aquitaine is a company
that does not have a lot of production growth in the near-term, but it
does have a substantial reserve life and a good production growth
profile for after the year 2000. Total, on the other hand, has
positioned itself well for between now and the year 2000. By investing
in both stocks, we were able to buy two very different energy
companies, each with its unique investment appeal, selling at
attractive valuation levels. Both companies made strong contributions
to the fund's overall investment return.
Q. WHILE THE FUND WAS UNDERWEIGHTED IN THE WEAK JAPANESE MARKET, MANY
OF ITS JAPANESE STOCKS PERFORMED WELL. HOW DO YOU EXPLAIN THIS?
A. I'd really have to tip my cap to our entire research team in Japan.
As our analysts visited companies, one thing became clear: Despite
Japan's sluggish economic recovery and the dismal overall performance
of its local markets, strong research uncovered some companies that
were prospering. Many of the companies we found were large exporters
such as those in the auto and technology sectors. These companies
benefited from a weak yen, which has helped them become very
competitive in world markets. Many - such as Fuji Photo Film and
Matsushita Communication Industrial - also had favorable balance
sheets, while companies such as Toyota were able to produce good cash
flows and buy back stock. Sales growth was also a strong factor, as we
found many companies that had both international and domestic sales
growth. Many - such as Honda - had very cheap valuations compared to
their peers, but were growing earnings at a fast clip. Good earnings
prospects often translate into a positive investment opportunity.
Q. ASIDE FROM SOME OF THE POSITIONS YOU'VE MENTIONED, WHICH STOCKS
PERFORMED WELL? WHICH WERE DISAPPOINTMENTS?
A. Some of the fund's oil-related positions performed well, notably
Shell Transport & Trading Co., British Petroleum and Elf Aquitaine.
Each company thrived due to shareholder-friendly management, healthy
cash flows and reduced costs. In terms of disappointments, I'd have to
single out Volkswagen, which announced a significant capital-raising
exercise. The German automaker had been generating good business
growth. Why it decided to announce one of the largest stock issues in
German corporate history was a mystery to me. Another area of
discomfort was the Japanese finance sector. Many Japanese brokerage
firms performed poorly, mostly due to the weak local market and low
trading volumes. Japanese banks also detracted from performance, as
did many of the fund's metals-related stocks.
Q. WHAT'S YOUR TAKE ON THE RECENT VOLATILITY WE'VE SEEN, PARTICULARLY
THE LATE-OCTOBER CORRECTION IN SOUTHEAST ASIA?
A. Strange as it may sound, I actually enjoy volatility. Market
fluctuations can be a bit frustrating on a day-to-day basis, but
volatility can present great buying opportunities for investors like
myself who follow a value-oriented discipline. When I see that stocks
are down, I generally look to see whether a buying opportunity is
present. On the other hand, when stocks are up significantly, it
creates an opportunity to sell some of the fund's more expensive
holdings and to buy stocks that may be less in favor but may offer
potential. So, while the fund's share price fluctuation may be
frustrating for shareholders to watch, I think it helps overall
performance to be able to find cheap stocks.
Q. WHAT'S YOUR OUTLOOK?
A. I expect European economies to continue to improve and am also
optimistic that Japan's economy can turn the corner. Southeast Asia,
on the other hand, appears to be slowing down. I'll continue to focus
on finding relatively cheap stocks that have growth or recovery
potential.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
CANADA 3.2%
UNITED STATES 15.1%
ROW: 1, COL: 1, VALUE: 3.2
ROW: 1, COL: 2, VALUE: 12.5
ROW: 1, COL: 3, VALUE: 5.0
ROW: 1, COL: 4, VALUE: 16.8
ROW: 1, COL: 5, VALUE: 6.6
ROW: 1, COL: 6, VALUE: 18.2
ROW: 1, COL: 7, VALUE: 7.6
ROW: 1, COL: 8, VALUE: 15.0
ROW: 1, COL: 9, VALUE: 15.1
FRANCE 12.5%
UNITED
KINGDOM 15.0%
GERMANY 5.0%
JAPAN 16.8%
SWEDEN 7.6%
NETHERLANDS 6.6%
OTHER 18.2%
AS OF APRIL 30, 1997
CANADA 3.2%
UNITED STATES 14.8%
ROW: 1, COL: 1, VALUE: 3.2
ROW: 1, COL: 2, VALUE: 10.0
ROW: 1, COL: 3, VALUE: 4.2
ROW: 1, COL: 4, VALUE: 25.3
ROW: 1, COL: 5, VALUE: 6.0
ROW: 1, COL: 6, VALUE: 13.5
ROW: 1, COL: 7, VALUE: 5.7
ROW: 1, COL: 8, VALUE: 4.2
ROW: 1, COL: 9, VALUE: 13.1
ROW: 1, COL: 10, VALUE: 14.8
FRANCE 10.0%
UNITED
KINGDOM 13.1%
GERMANY 4.2%
SWITZERLAND 4.2%
JAPAN 25.3%
SWEDEN 5.7%
OTHER 13.5%
NETHERLANDS 6.0%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS, CLOSED-END INVESTMENT 86.3 87.9
COMPANIES AND EQUITY FUTURES

BONDS 0.4 1.1

SHORT-TERM INVESTMENTS 13.3 11.0

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

VOLVO AB CLASS B 3.2 1.3
(SWEDEN, AUTOS, TIRES, & ACCESSORIES)

ALCATEL ALSTHOM COMPAGNIE GENERALE 1.9 2.1
D'ELECTRICITE SA
(FRANCE, ELECTRICAL EQUIPMENT)

RHONE POULENC SA CLASS A 1.6 0.6
(FRANCE, DRUGS & PHARMACEUTICALS)

NATIONALE ELF AQUITAINE 1.5 0.2
(FRANCE, OIL & GAS)

NOVARTIS AG (REG.) 1.5 1.4
(SWITZERLAND, DRUGS & PHARMACEUTICALS)

SMITHKLINE BEECHAM PLC ORD. 1.4 0.9
(UNITED KINGDOM, DRUGS &
PHARMACEUTICALS)

TOTAL SA CLASS B 1.4 1.0
(FRANCE, OIL & GAS)

MATSUSHITA ELECTRIC INDUSTRIAL CO. LTD. 1.2 0.6
(JAPAN, CONSUMER ELECTRONICS)

AKZO NOBEL NV 1.1 0.9
(NETHERLANDS, CHEMICALS & PLASTICS)

CREDIT SUISSE GROUP (REG.) 1.0 1.2
(SWITZERLAND, BANKS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 15.3 13.5

BASIC INDUSTRIES 9.5 11.5

DURABLES 9.2 8.1

HEALTH 8.4 7.5

ENERGY 8.1 7.0

TECHNOLOGY 5.7 9.6

UTILITIES 5.4 5.1

INDUSTRIAL MACHINERY & EQUIPMENT 5.0 5.2

NONDURABLES 4.5 5.8

CONSTRUCTION & REAL ESTATE 4.0 4.3

INTERNATIONAL VALUE
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 83.3%
SHARES VALUE (NOTE 1)
ARGENTINA - 0.4%
Bansud SA Class B (a) 50,000 $ 445,264
Telecom Argentina Class B
sponsored ADR 5,500 139,219
YPF Sociedad Anonima sponsored
ADR representing Class D shares 28,600 915,200
1,499,683
AUSTRALIA - 1.2%
Australia & New Zealand Banking
Group Ltd. 119,100 828,271
Broken Hill Proprietary Co. Ltd. (The) 59,400 587,157
CSR Ltd. 92,100 319,024
Colonial Ltd. (a) 107,200 297,604
Leighton Holdings Ltd. 215,200 792,046
National Australia Bank Ltd. 45,900 625,866
QNI Ltd. 195,200 171,056
Tabcorp Holdings Ltd. 30,300 138,497
Western Mining Holdings Ltd. 269,143 952,848
Westpac Banking Corp. 24,100 139,893
Woodside Petroleum Ltd. 49,977 420,787
5,273,049
AUSTRIA - 0.1%
Voest-Alpine Stahl AG 6,400 276,942
BELGIUM - 0.1%
BBL (Banque Bruxelles Lambert) 2,000 507,546
BRAZIL - 0.9%
Centrais Electricas Brasileiras SA 1,153,000 498,804
Compania Energertica Minas Gerais 24,738,000 987,187
Petrobras PN (Pfd. Reg.) 4,729,000 879,236
Telebras sponsored ADR 12,500 1,268,750
3,633,977
CANADA - 3.2%
Abitibi-Consolidated, Inc. 14,500 205,900
Alcan Aluminium Ltd. 51,400 1,459,761
Alliance Forest Products, Inc. (a) 13,800 286,592
Alliance Forest Products, Inc. (a)(c) 15,000 311,513
BCE, Inc. 36,000 1,003,231
Bank of Nova Scotia (Halifax) 5,800 255,934
Bell Canada International, Inc. 7,000 118,783
Bro-X Minerals Ltd. 6,220 -
CGI Group, Inc. Class A (sub. vtg.) 20,000 568,710
Canadian Imperial Bank of Commerce 5,800 169,662
Canadian Natural Resources Ltd. (a) 37,500 1,091,626
Cinar Films, Inc. Class B (sub. vtg.) (a) 4,500 173,169
Cominco Ltd. 52,800 1,027,172
Dofasco, Inc. 6,200 111,811
Domtar, Inc. 90,700 705,148
Greenstone Resources Ltd. (a) 60,000 489,900
Hudson's Bay Co. Ord. 13,700 313,696
Inco Ltd. 38,500 789,982
Leitch Technology Corp. (a) 12,700 388,633
National Bank of Canada 69,000 982,250
Noranda, Inc. 90,700 1,597,046
Renaissance Energy Ltd. (a) 53,500 1,242,110
Rio Alto Exploration Ltd. (a) 12,900 121,357
St. Laurent Paperboard, Inc. (a) 24,000 387,660
TVI Pacific, Inc. (a) 593,000 58,944
13,860,590

SHARES VALUE (NOTE 1)
DENMARK - 0.8%
Den Danske Bank Group AS 8,000 $ 901,820
International Service Systems
AS, Series B (a) 30,800 933,689
Novo-Nordisk AS Class B 5,500 594,866
Sophus Berendsen AS, Series B 2,900 437,352
Unidanmark AS Class A 7,800 526,377
3,394,104
FINLAND - 2.3%
Cultor OY Ord., Series 2 35,000 1,871,983
Enso OY Class R 128,700 1,217,668
Huhtamaki Ord. 23,400 962,387
Metsa-Serla Ltd. Class B 154,100 1,368,720
Nokia Corp. AB, Series A 5,500 480,015
Outokumpu OY Class A 72,900 1,090,896
Rauma OY 5,061 95,279
UPM-Kymmene Corp. 66,900 1,504,895
Valmet OY 82,020 1,282,800
9,874,643
FRANCE - 12.5%
Alcatel Alsthom Compagnie Generale
d'Electricite SA sponsored ADR 85,000 2,066,563
Alcatel Alsthom Compagnie Generale
d'Electricite SA 65,700 7,915,457
Axa SA 17,100 1,169,216
Axime SA Ex Segin (a) 5,400 601,044
Axime SA Ex Segin (a)(c) 7,000 779,131
Cap Gemini Sogeti SA 19,400 1,538,043
Carrefour Supermarche SA 1,581 823,758
Compagnie de Saint Gobain 4,400 630,644
Credit Commercial de France Ord. 15,000 848,545
Elf Sanofi SA 6,400 607,102
Eramet SA 23,700 943,577
Generale des Eaux, Cie 2,078 241,362
Groupe Danone 900 137,408
Lafarge SA 2,500 155,965
Lagardere S.C.A. (Reg.) 17,500 502,558
Michelin SA (Compagnie Generale
des Etablissements) Class B 14,456 740,448
Nationale Elf Aquitaine 51,900 6,414,561
Pechiney SA Class A 55,292 2,270,275
Rhone Poulenc SA Class A 156,984 6,834,312
Societe Generale Class A 22,300 3,049,533
Total SA:
Class B 52,682 5,836,381
sponsored ADR 68,700 3,812,850
Usinor Sacilor 167,200 2,764,019
Union Assurances Federale SA 16,100 1,797,575
Valeo SA 15,300 1,018,861
53,499,188
GERMANY - 3.9%
Allianz Aktiengesellschaft Holdings
(Reg.) 5,800 1,306,261
BASF AG 36,500 1,246,290
Bayer AG 29,100 1,025,670
(BMW) Muenchen Bayerische
Motorenwerke AG 409 300,645
BHF Bank (Bank Berlin Hand) 104,700 3,156,174
Buderus AG 500 242,319
Continental Gummi-Werke AG 21,500 516,623
Daimler-Benz AG Ord. 43,500 2,920,174
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
GERMANY - CONTINUED
Deutsche Bank AG 4,000 $ 262,841
Dresdner Bank AG Ord. 5,000 205,217
Hornbach Baumarket AG (Bearer) 5,000 148,116
Hoechst AG Ord. 36,400 1,390,586
Lufthansa Deutsche AG (Reg.) 26,400 472,139
Mannesmann AG Ord. 4,300 1,819,710
Marseille-Kliniken AG 24,600 413,565
Philipp Holzmann AG (a) 500 142,029
Siemens AG 6,200 379,548
Veba AG Ord. 13,000 725,362
16,673,269
HONG KONG - 0.6%
Asia Satellite Telecommunications
Holdings Ltd. 58,000 139,560
Cheung Kong Holdings Ltd. 36,000 250,323
China Light & Power Co. Ltd. 70,000 368,564
China Telecom (Hong Kong) Ltd. (a) 310,000 495,278
Hutchison Whampoa Ltd. Ord. 46,000 318,370
New World Development Co. Ltd. 22,000 77,413
Peregrine Investments Holdings Ltd. 400,000 393,273
Vtech Holdings Ltd. 302,000 589,935
2,632,716
INDIA - 0.1%
Mahindra & Mahindra Ltd. GDR 11,000 110,000
State Bank of India GDR (Reg.) 6,300 110,250
220,250
INDONESIA - 0.1%
PT Matahari Putra Prima 572,000 111,222
PT Matahari Putra Prima
rights 12/31/97 (a) 1,144,000 63,556
PT Multipolar 2,268,498 204,795
PT Putra Surya Multidana (a) 277,500 96,354
475,927
IRELAND - 0.6%
Bank of Ireland, Inc. 85,000 1,066,541
CRH PLC 16,000 190,663
Smurfit (Jefferson) Group PLC 280,000 820,015
Smurfit (Jefferson) Group PLC (New) 167,400 485,495
2,562,714
ITALY - 1.3%
Credito Italiano Ord. 452,500 1,211,163
Eni Spa 359,700 2,032,831
Telecom Italia Spa 221,665 1,386,396
Telecom Italia Mobile Spa 300,100 1,107,746
5,738,136
JAPAN - 16.7%
Acom Co. Ltd. 45,800 2,510,631
Amway Japan Ltd. 10,000 262,458
Amway Japan Ltd. sponsored ADR 10,000 129,375
Asahi Breweries Ltd. 19,000 280,897
Bank of Tokyo-Mitsubishi Ltd. 111,000 1,447,425
Canon, Inc. 23,000 557,807
Circle K Japan Co. Ltd. 5,000 256,645
Citizen Watch Co. Ltd. Ord. 108,000 688,904
Dai-Ichi Kangyo Bank 49,000 415,116
Daiichi Pharmaceutical Co. Ltd. 22,000 312,458
Daiwa House Industry Co. Ltd. 50,000 481,728
Daiwa Securities Co. Ltd. 105,000 634,884

SHARES VALUE (NOTE 1)
Denso Corp. 18,000 $ 388,704
Daito Trust Construction Co. 50,200 446,130
Fuji Bank Ltd. 120,000 1,036,545
Fuji Heavy Industries Ltd. 62,000 246,661
Fuji International Trust unit
sponsored ADR (c) 9 230,680
Fuji Photo Film Co. Ltd. 28,000 1,013,954
Fujitsu Ltd. 145,000 1,589,701
Hitachi Ltd. 114,000 875,831
Hitachi Maxell Ltd. 58,000 1,291,030
Honda Motor Co. Ltd. 30,000 1,009,136
Ibiden Co. Ltd. 12,000 199,336
Ito-Yokado Co. Ltd. 16,000 794,684
Jafco Co. Ltd. 18,000 852,159
Jusco Co. Ltd. 37,000 826,661
Kao Corp. 67,000 934,884
Kobe Steel Ltd. Ord. (a) 250,000 301,080
Komatsu Ltd. Ord. 241,000 1,287,068
Kyocera Corp. 18,000 1,030,066
Long Term Credit Bank of
Japan Ltd. (The) 493,000 1,666,537
Matsushita Electric Industrial Co. Ltd. 310,000 5,200,997
Matsushita Communication
Industrial Co. Ltd. 49,000 1,729,651
Matsushita Electric Works Co. Ltd. 59,000 534,136
Minebea Co. Ltd. 181,000 1,803,987
Minolta Camera Co. Ltd. 245,000 1,271,802
Mitsubishi Estate Co. Ltd. 87,000 1,098,339
Mitsubishi Trust & Banking Corp. 39,000 479,402
Mitsui Fudosan Co. Ltd. 64,000 722,924
Murata Manufacturing Co. Ltd. 5,000 202,658
Nichiei Co. Ltd. 11,000 1,205,980
Nintendo Co. Ltd. Ord. 13,900 1,200,664
Nippon Telegraph & Telephone
Corp. Ord. 372 3,151,495
Nomura Securities Co. Ltd. 105,000 1,220,930
Nichicon Corp. 20,000 247,508
Omron Corp. 83,000 1,406,312
Orix Corp. 13,600 928,505
Ricoh Co. Ltd. Ord. 43,000 553,571
Rohm Co. Ltd. 12,000 1,186,047
Sakura Bank Ltd. 440,000 1,794,352
Sankyo Co. Ltd. 73,000 2,407,060
Sekisui House Ltd. 50,000 427,741
Shimamura Corp. 10,000 269,934
Shimachu Co. Ltd. 25,000 531,561
Shin-Etsu Chemical Co. Ltd. 27,000 659,302
Shinko Electric Industries Co. Ltd. 12,500 529,485
Sony Corp. 22,800 1,891,794
Shohkoh Fund & Co. Ltd. 700 203,488
Sony Music Entertainment Japan, Inc. 37,000 1,299,917
Sumitomo Sitix Corp. 7,000 123,256
Sumitomo Realty & Development Co. Ltd. 40,000 292,027
TDK Corp. 18,000 1,492,027
THK Co. Ltd. 123,400 1,650,116
Takeda Chemical Industries Ltd. 122,000 3,323,588
Takefuji Corp. 3,000 133,306
Terumo Corp. 27,000 444,020
Toyo Trust & Banking Co. Ltd. 13,000 97,068
Tokyo Electron Ltd. 23,000 1,146,179
Uni Charm Corp. Ord. 31,000 1,042,774
Uny Co. Ltd. 39,000 631,645
World Co. Ltd. 13,700 506,354
Xebio Co. Ltd. 27,200 438,272
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
JAPAN - CONTINUED
Yamanouchi Pharmaceutical Co. Ltd. 15,000 $ 368,771
Yamaha Motor Co. Ltd. 86,000 692,857
Yasuda Trust & Banking 163,000 434,576
Yoshinoya D&C Co. Ltd. Ord. 20 210,963
71,186,516
KOREA (SOUTH) - 0.0%
Korea Electric Power Corp. 10,000 141,969
MALAYSIA - 0.1%
Magnum Corp. BHD 65,000 50,642
Malayan Banking BHD 5,000 19,254
Oriental Holdings BHD 142,000 288,239
Oriental Holdings BHD (New) 42,000 84,188
442,323
MEXICO - 0.9%
DESC (Sociedad de Fomento
Industrial SA) Class B 30,000 257,757
Grupo Carso SA de CV Class A-1 29,000 183,759
Grupo Financiero Bancomer Class B (a) 2,949,000 1,390,042
Grupo Mexico SA Class L 13,000 38,473
Grupo Financiero Inbursa SA Class B 39,000 137,291
Industrias Penoles SA 9,000 35,710
Telefonos de Mexico SA sponsored ADR
representing Ord. Class L shares 23,900 1,033,675
Tubos de Acero de Mexico ADR (a) 39,700 801,444
3,878,151
NETHERLANDS - 6.6%
AKZO Nobel NV 26,900 4,731,357
Ahold NV 97,043 2,479,711
Beter Bed Holding NV 7,300 158,761
ING Groep NV 57,618 2,414,328
KBB NV Ord. 2,900 182,648
KLM Royal Dutch Air Lines NV 4,400 148,853
Koninklijke Hoogovens NV 33,400 1,528,329
Koninklijke KNP BT NV 34,900 793,100
Koninklijke Pakhoed NV 3,900 127,527
New Holland NV 20,000 568,750
Nutreco Holding NV (a) 19,900 446,087
Philips Electronics NV:
warrants 6/30/98 (a) 16,000 983,033
(Bearer) 39,300 3,071,260
Royal Dutch Petroleum Co. Ord. 52,700 2,782,668
Unilever NV Ord. 66,800 3,544,350
Vendex International NV 35,406 1,929,581
VNU Ord. 94,800 2,242,057
28,132,400
NETHERLANDS ANTILLES - 0.1%
Schlumberger Ltd. 3,000 262,500
NEW ZEALAND - 0.1%
Air New Zealand Ltd. Class B 102,800 217,454
Lion Nathan Ltd. 109,700 264,809
Lion Nathan Ltd. (Astl.) 9,300 22,493
504,756
NORWAY - 1.2%
Den Norske Bank AS Class A Free shares 145,000 652,874
Elkem ASA 97,100 1,473,476
NCL Holdings AS (a) 484,300 1,849,369
Nydalens Compagnie ASA 50,000 349,092
Olav Thon Eiendomsselskp Ord. 10,500 347,098

SHARES VALUE (NOTE 1)
Steen & Stroem ASA (a) 21,000 $ 374,028
5,045,937
PERU - 0.1%
Compania de Minas Buenaventura SA
Class B sponsored ADR 14,000 251,125
PORTUGAL - 0.2%
Electricidade de Portugal SA 38,200 669,909
Portugal Telecom SA sponsored ADR 5,000 206,250
876,159
RUSSIA - 0.0%
Vimpel Communications sponsored ADR 3,800 124,450
SOUTH AFRICA - 0.4%
Dimension Data Holdings Ltd. (a) 39,796 165,300
Gencor Ltd. (Reg.) 29,000 65,047
JCI Ltd. 36,000 153,271
Sasol Ltd. 113,100 1,362,368
1,745,986
SPAIN - 1.3%
Acerinox SA (Reg.) 2,300 342,768
Banco Bilbao Vizcaya SA Ord. (Reg.) 61,100 1,630,060
Telefonica de Espana SA Ord. 89,700 2,442,281
Tele Pizza SA (a) 14,600 1,000,302
5,415,411
SWEDEN - 7.6%
ABB AB:
Series A 51,300 597,107
Series B 25,000 287,662
Astra AB Class A Free shares 222,833 3,586,670
Assi Doman AB Free shares 10,000 279,348
Ericsson (L.M.) Telephone Co. Class B 12,300 539,940
Electrolux AB 15,600 1,286,598
Esselte AB Class B Free shares 38,700 839,122
Forcenergy AB Class B Free shares 50,000 608,580
Granges AB (Reg.) (a) 8,650 140,954
IBS (International Business Systems) AB
Class B Free shares (a) 130,000 1,720,652
Munters AB (a)(c) 23,300 235,557
Nordbanken AB 32,600 1,019,089
SKF AB Ord. 21,500 497,639
Skandia Foersaekrings AB 36,800 1,713,336
Svenska Cellulosa AB (SCA)
Class B Ord. 16,000 357,566
Svenska Handelsbanken 25,000 788,161
Swedish Match Co. 1,312,200 4,014,712
Svedala Industri Free shares 25,000 488,859
Volvo AB Class B 519,500 13,544,662
32,546,214
SWITZERLAND - 3.9%
Credit Suisse Group (Reg.) 30,200 4,259,528
Julius Baer Holding AG 1,109 1,657,354
Nestle SA (Reg.) 1,856 2,618,440
Novartis AG (Reg.) 3,993 6,261,458
Roche Holding AG participation
certificates 119 1,047,047
Sulzer AG (Reg.) 604 442,257
SGS Societe Generale de Surveillance
Holding SA (Bearer) 135 260,636
16,546,720
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TURKEY - 0.0%
Tupras-Turkiye Petrol Rafinerileri AS (a) 2,127,400 $ 190,499
UNITED KINGDOM - 15.0%
Asda Group PLC 98,800 256,280
BAT Industries PLC Ord. 199,900 1,739,703
BOC Group PLC 7,700 129,246
BBA Group PLC 41,900 282,582
Barclays PLC Ord. 112,000 2,798,360
Bass PLC Ord. 40,000 554,263
Billiton PLC 145,000 419,191
Blue Circle Industries PLC 51,200 299,891
British Aerospace PLC 64,900 1,718,213
British Petroleum PLC Ord. 178,830 2,621,623
British Land Co. PLC (The) Ord. 28,200 327,989
British Telecommunications PLC Ord. 18,000 136,457
Caradon PLC 689,060 2,190,970
Cookson Group PLC 784,100 3,136,137
Dorling Kindersley Holdings PLC Class L 376,500 1,795,707
DR Solomons Group PLC sponsored ADR 22,800 698,250
English China Clay PLC 60,700 264,112
Gallaher Group PLC 151,200 721,145
Glaxo Wellcome PLC 149,600 3,199,545
Granada Group PLC 45,800 630,033
Grand Metropolitan PLC 47,400 426,763
Guinness PLC Ord. 35,000 312,191
HSBC Holdings PLC Ord. 62,500 1,553,217
Hays PLC 15,000 175,718
ICI (Imperial Chemical Industries) PLC
Class L 40,000 589,072
Inchcape PLC Ord. 159,400 581,528
JJB Sports PLC Class L 89,800 856,598
Ladbroke Group PLC Ord. 184,100 822,604
Lloyds TSB Group PLC 295,121 3,679,443
Mercury Asset Management Group PLC 12,400 271,320
National Grid Co. PLC 84,600 397,834
Pearson, PLC 115,000 1,501,130
Perpetual PLC 3,100 117,245
Pilkington PLC Ord. 780,000 1,957,995
Rentokil Initial PLC 942,300 3,705,807
Royal & Sun Alliance Insurance
Group PLC 162,200 1,551,289
Rugby Group PLC 90,000 194,293
Securicor Group PLC 198,000 888,026
Shell Transport & Trading Co. PLC:
ADR 48,200 2,057,538
(Reg.) 456,700 3,231,026
SmithKline Beecham PLC Ord. 619,974 5,862,025
Somerfield PLC 539,200 1,732,514
SIG PLC 20,800 97,117
Tarmac 270,000 528,659
Thames Water PLC Ord. 23,300 352,883
Tomkins PLC Ord. 30,000 153,627
Thorntons PLC 250,000 974,814
Unigate PLC 75,000 724,207
Unilever PLC Ord. 196,000 1,456,347
Vodafone Group PLC 553,074 3,012,728
WPP Group PLC 40,500 184,353
63,869,608
UNITED STATES OF AMERICA - 1.0%
Alumax, Inc. (a) 21,200 689,000
Aluminum Co. of America 14,400 1,051,200
D.R. Horton, Inc. 65,400 981,000

SHARES VALUE (NOTE 1)
MCI Communications Corp. 26,500 $ 940,750
Newmont Mining Corp. 8,000 280,000
Pharmacia & Upjohn, Inc. 15,700 498,098
4,440,048
TOTAL COMMON STOCKS
(Cost $345,189,385) 355,723,506
CLOSED-END INVESTMENT COMPANIES - 0.7%
EMERGING MARKETS - 0.1%
TCW/DW Emerging Markets
Opportunities Trust (SBI) 12,900 160,444
Templeton Dragon Fund, Inc. 33,400 427,938
588,382
GERMANY - 0.3%
Emerging Germany Fund, Inc. 10,700 113,688
New Germany Fund, Inc. (The) 60,300 900,731
1,014,419
MULTI-NATIONAL - 0.3%
European Warrant Fund, Inc. 60,600 1,064,288
Morgan Stanley Asia-Pacific Fund, Inc. 13,800 111,263
1,175,551
PORTUGAL - 0.0%
Portugal Fund, Inc. 7,000 118,125
TOTAL CLOSED-END INVESTMENT COMPANIES
(Cost $3,026,249) 2,896,477
PREFERRED STOCKS - 2.0%
CONVERTIBLE PREFERRED STOCKS - 0.3%
AUSTRALIA - 0.1%
National Australia Bank Ltd. 7.8750% 15,700 436,656
JAPAN - 0.1%
AJL participating trust $1.44 43,500 636,188
UNITED STATES OF AMERICA - 0.1%
WBK STRYPES Trust $3.135 17,000 527,000
TOTAL CONVERTIBLE PREFERRED STOCKS 1,599,844
NONCONVERTIBLE PREFERRED STOCKS - 1.7%
AUSTRALIA - 0.4%
Sydney Harbour Casino Holdings Ltd. (a) 1,530,101 1,555,382
GERMANY - 0.8%
SAP (Systeme Anwendungen
Produkte) AG 3,100 925,058
Wella AG 3,810 2,672,522
3,597,580
ITALY - 0.5%
Telecom Italia Spa 209,375 843,094
Telecom Italia Mobile Spa de Risp 553,200 1,130,453
1,973,547
TOTAL NONCONVERTIBLE PREFERRED STOCKS 7,126,509
TOTAL PREFERRED STOCKS
(Cost $7,987,471) 8,726,353
GOVERNMENT OBLIGATIONS - 0.4%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (E) AMOUNT (C) (NOTE 1)
UNITED STATES OF AMERICA - 0.4%
U.S. Treasury Bill, yield at date of
purchase 5.28%, 1/8/98 (d) $ 150,000 $ 148,588
U.S. Treasury Notes:
9 1/4%, 8/15/98 370,000 380,290
8 7/8%, 11/15/98 404,000 417,005
8 7/8%, 2/15/99 370,000 384,685
9 1/8%, 5/15/99 360,000 378,169
TOTAL GOVERNMENT OBLIGATIONS
(Cost $1,776,259) 1,708,737
CASH EQUIVALENTS - 13.6%
SHARES
Taxable Central Cash Fund (b)
(Cost $57,902,716) 57,902,716 57,902,716
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $415,882,080) $ 426,957,789
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
14 Nikkei 225 Stock
Index Contracts Dec 97 $1,148,700 $(153,649)
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL
INVESTMENT IN SECURITIES - 0.3%
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$1,556,881 or 0.4% of net assets.
(d) A portion of the security was pledged to cover margin requirements
for futures contracts. At the period end, the value of securities
pledged amounted to $47,500.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $321,049,838 and $242,612,897, respectively, of which U.S.
government and government agency obligations aggregated $244,394 and
$760,000, respectively (see Note 3 of Notes to Financial Statements).
The market value of futures contracts opened and closed during the
period amounted to $14,619,130 and $17,226,147, respectively (see Note
2 of Notes to Financial Statements).
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of Fidelity Management & Research Company.
The commissions paid to these affiliated firms were $74,284 for the
period (see Note 4 of Notes to Financial Statements).
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $416,161,089. Net unrealized appreciation
aggregated $10,796,700, of which $41,147,186 related to appreciated
investment securities and $30,350,486 related to depreciated
investment securities.
The fund hereby designates approximately $8,522,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.4%
Basic Industries 9.5
Cash Equivalents 13.5
Construction & Real Estate 4.0
Durables 9.2
Energy 8.1
Finance 15.3
Government Obligations 0.4
Health 8.4
Holding Companies 1.5
Industrial Machinery & Equipment 5.0
Media & Leisure 3.4
Nondurables 4.5
Precious Metals 0.5
Retail & Wholesale 3.3
Services 1.7
Technology 5.7
Transportation 0.2
Utilities 5.4
100.0%
INTERNATIONAL VALUE
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
426,957,789
(COST $415,882,080) - SEE ACCOMPANYING SCHEDULE

CASH
178,519

RECEIVABLE FOR INVESTMENTS SOLD
6,567,185

RECEIVABLE FOR FUND SHARES SOLD
6,311,433

DIVIDENDS RECEIVABLE
895,874

INTEREST RECEIVABLE
287,817

RECEIVABLE FOR DAILY VARIATION ON FUTURES CONTRACTS
20,650

OTHER RECEIVABLES 4,175

TOTAL ASSETS
441,223,442

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 32,423,314

PAYABLE FOR FUND SHARES REDEEMED 5,586,325

ACCRUED MANAGEMENT FEE 276,776

OTHER PAYABLES AND 190,507

ACCRUED EXPENSES

TOTAL LIABILITIES
38,476,922

NET ASSETS $
402,746,520

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
370,007,653

UNDISTRIBUTED NET INVESTMENT INCOME
3,062,590

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
18,745,215

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
10,931,062
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 32,291,860 $
402,746,520
SHARES OUTSTANDING

NET ASSET VALUE, OFFERING PRICE
$12.47
AND REDEMPTION PRICE PER SHARE ($402,746,520 (DIVIDED BY) 32,291,860 SHARES)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 6,100,200
DIVIDENDS

INTEREST 1,614,291

7,714,491

LESS FOREIGN TAXES WITHHELD (646,427)

TOTAL INCOME 7,068,064

EXPENSES

MANAGEMENT FEE $ 2,278,039
BASIC FEE

PERFORMANCE ADJUSTMENT 318,389

TRANSFER AGENT FEES 742,073

ACCOUNTING FEES AND EXPENSES 229,548

NON-INTERESTED TRUSTEES' COMPENSATION 1,557

CUSTODIAN FEES AND EXPENSES 237,510

REGISTRATION FEES 87,962

AUDIT 23,273

LEGAL 2,126

REPORTS TO SHAREHOLDERS 29,935

MISCELLANEOUS 6,708

TOTAL EXPENSES BEFORE REDUCTIONS 3,957,120

EXPENSE REDUCTIONS (37,558) 3,919,562

NET INVESTMENT INCOME 3,148,502

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 19,614,841

FOREIGN CURRENCY TRANSACTIONS (27,540)

FUTURES CONTRACTS (720,369) 18,866,932

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 10,741,882

ASSETS AND LIABILITIES IN 8,440
FOREIGN CURRENCIES

FUTURES CONTRACTS (152,164) 10,598,158

NET GAIN (LOSS) 29,465,090

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 32,613,592

OTHER INFORMATION $ 34,141
EXPENSE REDUCTIONS
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 149

TRANSFER AGENT CREDITS 3,268

$ 37,558

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 3,148,502 $ 3,786,783
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 18,866,932 8,945,621

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 10,598,158 (1,251,635)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 32,613,592 11,480,769

DISTRIBUTIONS TO SHAREHOLDERS (2,268,604) (56,772)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (4,990,927) (1,703,168)

TOTAL DISTRIBUTIONS (7,259,531) (1,759,940)

SHARE TRANSACTIONS 692,644,504 592,069,913
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 7,013,302 1,730,074

COST OF SHARES REDEEMED (593,130,534) (389,483,829)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 106,527,272 204,316,158

TOTAL INCREASE (DECREASE) IN NET ASSETS 131,881,333 214,036,987

NET ASSETS

BEGINNING OF PERIOD 270,865,187 56,828,200

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $3,062,590 AND $3,774,842,
RESPECTIVELY) $ 402,746,520 $ 270,865,187

OTHER INFORMATION
SHARES

SOLD 55,158,934 53,175,152

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 624,515 160,044

REDEEMED (47,398,321) (34,777,000)

NET INCREASE (DECREASE) 8,385,128 18,558,196

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31, NOVEMBER 1, 1994
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995

<TABLE>
<CAPTION>
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.33 $ 10.63 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .13 B .16 E .11 B

NET REALIZED AND UNREALIZED GAIN (LOSS) 1.33 .85 .52

TOTAL FROM INVESTMENT OPERATIONS 1.46 1.01 .63

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.10) (.01) -

FROM NET REALIZED GAIN (.22) (.30) -

TOTAL DISTRIBUTIONS (.32) (.31) -

NET ASSET VALUE, END OF PERIOD $ 12.47 $ 11.33 $ 10.63

TOTAL RETURN A 13.20% 9.64% 6.30%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 402,747 $ 270,865 $ 56,828

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.30% 1.28% 1.72%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS 1.28% 1.26% C 1.72%
C

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.03% 1.74% 1.08%

PORTFOLIO TURNOVER RATE 86% 71% 109%

AVERAGE COMMISSION RATE D $ .0133 $ .0264

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES
TO FINANCIAL STATEMENTS). B NET INVESTMENT INCOME PER SHARE HAS
BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. C FMR OR THE FUND HAS ENTERED INTO VARYING
ARRANGEMENTS WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A
PORTION OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES TO FINANCIAL
STATEMENTS). D FOR FISCAL YEARS BEGINNING ON OR AFTER
SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE
COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS
ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND
TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN
VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE
STRUCTURES MAY DIFFER. E INVESTMENT INCOME PER SHARE REFLECTS
A SPECIAL DIVIDEND WHICH AMOUNTED TO $.04 PER SHARE.

</TABLE>

OVERSEAS
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). Prior to July 1, 1995, the fund imposed a 3%
sales charge. If this sales charge were taken into account, total
returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

OVERSEAS 17.03% 97.12% 132.25%

MORGAN STANLEY CAPITAL 4.82% 74.59% 91.25%
INTERNATIONAL EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 82.99% 158.84%

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Morgan Stanley Capital International (MSCI) Europe, Australasia, Far
East (EAFE) Index - a market capitalization weighted, unmanaged index
of over 1,000 foreign stocks. To measure how the fund's performance
stacked up against its peers, you can compare it to the international
funds average, which reflects the performance of mutual funds with
similar objectives tracked by Lipper Analytical Services, Inc. The
past one year average represents a peer group of 406 mutual funds.
These benchmarks include reinvested dividends and capital gains, if
any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

OVERSEAS 17.03% 14.54% 8.79%

MORGAN STANLEY CAPITAL 4.82% 11.79% 6.70%
INTERNATIONAL EAFE INDEX

INTERNATIONAL FUNDS AVERAGE 10.39% 12.67% 9.68%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19971031 19971110 171142 S00000000000001
Overseas MS EAFE Index (Net)
00094 MS001
1987/10/31 10000.00 10000.00
1987/11/30 9919.09 10098.48
1987/12/31 10553.56 10398.33
1988/01/31 10143.25 10583.99
1988/02/29 10465.32 11289.48
1988/03/31 11100.65 11983.63
1988/04/30 11391.85 12157.77
1988/05/31 11162.42 11768.04
1988/06/30 10844.76 11457.85
1988/07/31 10703.57 11817.33
1988/08/31 10381.49 11048.99
1988/09/30 10769.75 11531.77
1988/10/31 11162.42 12518.45
1988/11/30 11453.62 13264.13
1988/12/31 11424.96 13338.08
1989/01/31 11564.95 13572.76
1989/02/28 11867.51 13642.52
1989/03/31 11763.65 13374.77
1989/04/30 12016.53 13498.82
1989/05/31 11438.51 12764.44
1989/06/30 11104.34 12549.57
1989/07/31 12206.19 14125.45
1989/08/31 11921.70 13490.18
1989/09/30 12558.43 14104.68
1989/10/31 11876.54 13537.99
1989/11/30 12549.39 14218.54
1989/12/31 13359.61 14743.16
1990/01/31 13056.41 14194.60
1990/02/28 12786.38 13203.89
1990/03/31 13208.01 11828.36
1990/04/30 13174.85 11734.49
1990/05/31 14070.23 13073.41
1990/06/30 14321.31 12958.26
1990/07/31 15027.19 13140.79
1990/08/31 13364.35 11864.71
1990/09/30 11881.52 10211.19
1990/10/31 13013.77 11802.28
1990/11/30 12582.67 11106.09
1990/12/31 12477.55 11286.00
1991/01/31 12754.38 11651.05
1991/02/28 13217.45 12900.03
1991/03/31 12784.58 12125.61
1991/04/30 12965.78 12244.69
1991/05/31 12990.95 12372.45
1991/06/30 12175.55 11463.31
1991/07/31 12839.95 12026.53
1991/08/31 12935.58 11782.29
1991/09/30 13504.34 12446.33
1991/10/31 13549.64 12622.77
1991/11/30 13061.41 12033.48
1991/12/31 13552.29 12654.93
1992/01/31 13707.88 12384.62
1992/02/29 13423.53 11941.35
1992/03/31 13144.54 11153.02
1992/04/30 13943.95 11206.04
1992/05/31 14544.84 11956.12
1992/06/30 14201.47 11389.02
1992/07/31 13300.13 11097.54
1992/08/31 13187.47 11793.58
1992/09/30 12640.22 11560.69
1992/10/31 11781.80 10954.28
1992/11/30 11722.79 11057.36
1992/12/31 11999.78 11114.55
1993/01/31 12349.52 11113.19
1993/02/28 12602.78 11448.88
1993/03/31 13459.05 12446.83
1993/04/30 14393.71 13628.07
1993/05/31 14725.36 13915.89
1993/06/30 14375.62 13698.78
1993/07/31 15032.89 14178.30
1993/08/31 15883.13 14943.69
1993/09/30 15744.43 14607.31
1993/10/31 16377.59 15057.48
1993/11/30 15629.86 13741.30
1993/12/31 16806.18 14733.52
1994/01/31 18000.94 15979.17
1994/02/28 17663.95 15934.91
1994/03/31 17155.42 15248.57
1994/04/30 17731.35 15895.55
1994/05/31 17504.65 15804.29
1994/06/30 17271.83 16027.64
1994/07/31 17755.86 16181.78
1994/08/31 18013.19 16564.88
1994/09/30 17516.91 16043.16
1994/10/31 17872.27 16577.40
1994/11/30 17137.04 15780.69
1994/12/31 17019.76 15879.50
1995/01/31 16290.34 15269.48
1995/02/28 16302.81 15225.66
1995/03/31 16789.09 16175.30
1995/04/30 17269.14 16783.63
1995/05/31 17512.28 16583.56
1995/06/30 17643.20 16292.74
1995/07/31 18434.96 17307.06
1995/08/31 17923.74 16646.86
1995/09/30 18173.12 16971.98
1995/10/31 17811.52 16515.77
1995/11/30 18011.02 16975.30
1995/12/31 18560.94 17659.24
1996/01/31 18912.11 17731.73
1996/02/29 18950.42 17791.68
1996/03/31 19231.36 18169.50
1996/04/30 19754.92 18697.75
1996/05/31 19761.30 18353.68
1996/06/30 19908.16 18456.98
1996/07/31 19352.67 17917.53
1996/08/31 19493.14 17956.79
1996/09/30 20055.01 18433.82
1996/10/31 19844.31 18245.19
1996/11/30 20891.43 18971.14
1996/12/31 20992.10 18727.09
1997/01/31 21005.71 18075.39
1997/02/28 21475.38 18375.44
1997/03/31 21665.97 18445.27
1997/04/30 21829.33 18546.72
1997/05/31 23163.46 19757.26
1997/06/30 24368.26 20849.84
1997/07/31 25178.26 21190.11
1997/08/31 23306.40 19610.39
1997/09/30 24974.06 20711.91
1997/10/31 23224.72 19125.17
IMATRL PRASUN SHR__CHT 19971031 19971110 171145 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity Overseas Fund on October 31, 1987. As the chart
shows, by October 31, 1997, the value of the investment would have
grown to $23,225 - a 132.25% increase on the initial investment. For
comparison, look at how the Morgan Stanley Capital International EAFE
Index did over the period. With dividends and capital gains, if any,
reinvested, the same $10,000 investment would have grown to $19,125 -
a 91.25% increase.

An interview with Richard Mace, Portfolio Manager of
Fidelity Overseas Fund
Q. HOW DID THE FUND PERFORM, RICK?
A. Quite well. For the 12 months that ended October 31, 1997, the fund
generated a total return of 17.03%. For the same period, the Morgan
Stanley Capital International Europe, Australasia, Far East (EAFE)
Index returned 4.82%. The international funds average, as tracked by
Lipper Analytical Services, returned 10.39% over the same time period.
Q. WHAT FACTORS PLAYED KEY ROLES IN THE FUND'S PERFORMANCE?
A. The fund's European finance-related stocks provided the most
significant contribution to performance over the past 12 months.
Additionally, substantial exposure to the technology, energy and
health care sectors helped, as these groups registered strong
performances. Another plus was the fund's limited exposure - relative
to the EAFE index - in the poorly performing Japanese market. All that
being said, individual stock picking continued to have the biggest
influence on performance. In general, the fund's 20 largest positions
performed well.
Q. WHY DID THE FUND'S FINANCE-RELATED POSITIONS PERFORM SO WELL?
A. My attraction to these stocks revolved primarily around their
individual business profiles. While I don't spend a lot of time
analyzing interest rates, inflation levels or economic conditions, low
interest rates throughout Europe were beneficial to many of the fund's
top finance stocks. More importantly, though, many of these companies
fit the profile I was looking for: Management was focused on
delivering results to shareholders, the company was generating strong
earnings growth and each had a healthy balance sheet. Examples
included Spanish bank Banco Bilbao Vizcaya, Switzerland's Credit
Suisse and Lloyds TSB Group in the United Kingdom. Each of these
larger positions performed quite well.
Q. YOU MENTIONED HEALTH CARE AND TECHNOLOGY STOCKS AS WELL . . .
A. In the health care group, the fund's pharmaceutical-related stocks
were strong performers. Because of new product introduction, many drug
companies generated good cash flows, which may be used to buy back
stock or pay down debt. Two of the fund's top five positions at the
end of the period - Novartis and Rhone Poulenc - were examples. For
the most part, the fund's technology exposure also helped performance.
Positions such as Philips Electronics, Nokia and Alcatel all enjoyed
superior sales and earnings growth. Some of the fund's Japanese
technology-related stocks - such as Sony and Matsushita Communication
Industrial - also performed well, as each benefited from strong
consumer product development in the areas of camcorders, cameras, TVs
and VCRs.
Q. DESPITE JAPAN'S ECONOMIC TROUBLES, MANY OF THE FUND'S JAPANESE
POSITIONS DID WELL. WHY?
A. I'd really have to tip my cap to our entire research team in Japan.
As our analysts visited company after company, one thing became clear:
Despite Japan's sluggish economic recovery and the dismal overall
performance of its local markets, strong research work uncovered some
companies that were prospering. Many of the companies we found were
large exporters such as those in the auto and technology sectors.
These companies benefited from a weak yen, which has helped them
become very competitive in world markets. Many, such as Fuji Photo
Film and Matsushita Communication Industrial, also had favorable
balance sheets, while companies such as Toyota were able to produce
good cash flows and buy back stock. Sales growth was also a strong
factor, as we found many companies that had both international and
domestic sales growth. Many - such as Honda - also had very cheap
valuations compared to their peers, but were growing earnings at a
fast clip. Good earnings prospects often translate into a positive
investment opportunity.
Q. WHICH STOCKS PERFORMED WELL? WHICH WERE DISAPPOINTING?
A. Some of the fund's oil-related positions performed well, notably
Total, British Petroleum and Nationale Elf Aquitaine. Each company
thrived due to shareholder-friendly management, healthy cash flows and
reduced costs. In terms of disappointments, I'd have to single out
Volkswagen, which announced a significant capital-raising exercise.
The German automaker had been generating good business growth - why
it announced one of the largest stock issues in German corporate
history was a mystery to me. Another area of discomfort was the
Japanese finance sector. Many Japanese brokerage firms performed
poorly, mostly due to the weak local market and low trading volumes.
Japanese banks also detracted from performance, as did many of the
fund's metals-related stocks.
Q. WHAT'S YOUR TAKE ON THE RECENT VOLATILITY WE'VE SEEN, PARTICULARLY
THE LATE-OCTOBER CORRECTION IN SOUTHEAST ASIA?
A. Strange as it may sound, I actually enjoy volatility. Market
fluctuations can be a bit frustrating on a day-to-day basis, but
volatility can present great buying opportunities for investors like
myself who follow a value-oriented discipline. When I see that stocks
are down, I generally look to see whether a buying opportunity is
present. On the other hand, when stocks are up significantly, it
creates an opportunity to sell some of the fund's more expensive
holdings and to buy stocks that may be less in favor but may offer
better value. So, while the fund's share price fluctuation may be
frustrating for shareholders to watch, I think volatility creates
outstanding investment opportunities.
Q. WHAT'S YOUR OUTLOOK?
A. I expect European economies to continue to improve and am also
optimistic that Japan's economy can turn the corner. Southeast Asia,
on the other hand, appears to be slowing down. I'll continue to focus
on finding relatively cheap stocks that have growth or recovery
potential.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
CANADA 3.7%
UNITED STATES 9.9%
FRANCE 12.1%
ROW: 1, COL: 1, VALUE: 9.9
ROW: 1, COL: 2, VALUE: 15.4
ROW: 1, COL: 3, VALUE: 4.9
ROW: 1, COL: 4, VALUE: 6.1
ROW: 1, COL: 5, VALUE: 15.2
ROW: 1, COL: 6, VALUE: 8.5
ROW: 1, COL: 7, VALUE: 20.1
ROW: 1, COL: 8, VALUE: 4.1
ROW: 1, COL: 9, VALUE: 12.1
ROW: 1, COL: 10, VALUE: 3.7
UNITED
KINGDOM 15.4%
GERMANY 4.1%
SWITZERLAND
4.9%
JAPAN 20.1%
SWEDEN 6.1%
OTHER 15.2%
NETHERLANDS 8.5%
AS OF APRIL 30, 1997
CANADA 2.6%
UNITED STATES 13.8%
FRANCE 10.0%
ROW: 1, COL: 1, VALUE: 13.8
ROW: 1, COL: 2, VALUE: 13.9
ROW: 1, COL: 3, VALUE: 5.2
ROW: 1, COL: 4, VALUE: 4.7
ROW: 1, COL: 5, VALUE: 15.0
ROW: 1, COL: 6, VALUE: 7.7
ROW: 1, COL: 7, VALUE: 22.8
ROW: 1, COL: 8, VALUE: 4.3
ROW: 1, COL: 9, VALUE: 10.0
ROW: 1, COL: 10, VALUE: 2.6
GERMANY 4.3%
UNITED
KINGDOM 13.9%
SWEDEN 5.2%
JAPAN 22.8%
SWITZERLAND 4.7%
OTHER 15.0%
NETHERLANDS 7.7%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS, CLOSED-END INVESTMENT 91.9 88.5
COMPANIES AND EQUITY FUTURES

BONDS 0.0 0.2

SHORT-TERM INVESTMENTS 8.1 11.3

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

TOTAL SA CLASS B 2.3 1.9
(FRANCE, OIL & GAS)

ALCATEL ALSTHOM COMPAGNIE GENERALE 2.1 2.3
D'ELECTRICITE SA
(FRANCE, ELECTRICAL EQUIPMENT)

RHONE POULENC SA CLASS A 2.0 0.6
(FRANCE, DRUGS & PHARMACEUTICALS)

NOVARTIS AG (REG.) 2.0 1.8
(SWITZERLAND, DRUGS & PHARMACEUTICALS)

PHILIPS ELECTRONICS NV (BEARER) 1.9 1.4
(NETHERLANDS, CONSUMER ELECTRONICS)

VOLVO AB CLASS B 1.6 1.5
(SWEDEN, AUTOS, TIRES, & ACCESSORIES)

TAKEDA CHEMICAL INDUSTRIES LTD. 1.4 1.6
(JAPAN, DRUGS & PHARMACEUTICALS)

AKZO NOBEL NV 1.4 1.1
(NETHERLANDS, CHEMICALS & PLASTICS)

CREDIT SUISSE GROUP (REG.) 1.3 1.3
(SWITZERLAND, BANKS)

ROYAL DUTCH PETROLEUM CO. ORD. 1.3 1.2
(NETHERLANDS, OIL & GAS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 16.4 13.7

HEALTH 9.9 7.7

DURABLES 9.9 10.3

BASIC INDUSTRIES 9.9 10.3

ENERGY 7.6 6.6

UTILITIES 7.3 6.4

TECHNOLOGY 6.5 8.2

NONDURABLES 5.0 6.3

INDUSTRIAL MACHINERY & EQUIPMENT 4.9 4.9

RETAIL & WHOLESALE 3.2 3.3

OVERSEAS
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 89.0%
SHARES VALUE (NOTE 1)
ARGENTINA - 0.2%
Telecom Argentina Class B sponsored
ADR 62,900 $ 1,592,363
YPF Sociedad Anonima sponsored ADR
representing Class D shares 185,700 5,942,400
7,534,763
AUSTRALIA - 1.8%
Australia & New Zealand Banking
Group Ltd. 1,255,300 8,729,878
Brambles Industries Ltd. 362,300 6,944,098
Broken Hill Proprietary Co. Ltd. (The) 615,500 6,084,097
CSR Ltd. 905,117 3,135,224
Coles Myer Ltd. 1,345,400 6,451,438
Colonial Ltd. (a) 1,301,700 3,613,725
Leighton Holdings Ltd. 351,600 1,294,068
National Australia Bank Ltd. 498,200 6,793,167
QNI Ltd. 2,040,800 1,788,379
Tabcorp Holdings Ltd. 309,500 1,414,677
Western Mining Holdings Ltd. 2,979,162 10,547,135
Westpac Banking Corp. 271,200 1,574,233
Woodside Petroleum Ltd. 272,000 2,290,134
Woolworths Ltd. 2,206,600 7,100,441
67,760,694
AUSTRIA - 0.1%
Voest-Alpine Stahl AG 76,100 3,293,015
BELGIUM - 0.1%
BBL (Banque Bruxelles Lambert) 22,103 5,609,142
BRAZIL - 1.1%
Centrais Electricas Brasileiras SA 10,375,000 4,488,368
Compania Energertica Minas Gerais 289,682,000 11,559,963
Petrobras PN (Pfd. Reg.) 51,103,000 9,501,284
Telebras sponsored ADR 137,600 13,966,400
39,516,015
CANADA - 3.7%
Abitibi-Consolidated, Inc. 164,600 2,337,321
Alcan Aluminium Ltd. 514,500 14,611,807
Alliance Forest Products, Inc. (a) 153,000 3,177,429
Alliance Forest Products, Inc. (a)(c) 159,000 3,302,034
BCE, Inc. 480,600 13,393,127
Bank of Nova Scotia (Halifax) 66,400 2,930,001
Bell Canada International, Inc. 79,400 1,347,340
Bro-X Minerals Ltd. 81,770 -
Canadian Imperial Bank of Commerce 65,900 1,927,708
Canadian Natural Resources Ltd. (a) 336,300 9,789,698
Cinar Films, Inc. Class B (sub. vtg.) (a) 45,700 1,758,628
Cominco Ltd. 593,700 11,549,846
Dofasco, Inc. 70,500 1,271,398
Domtar, Inc. 1,001,000 7,782,278
Greenstone Resources Ltd. (a) 268,800 2,194,753
Hudson's Bay Co. Ord. 141,100 3,230,839
Inco Ltd. 591,500 12,136,995
Leitch Technology Corp. (a) 130,500 3,993,432
National Bank of Canada 714,800 10,175,540
Noranda, Inc. 1,032,000 18,171,465
Renaissance Energy Ltd. (a) 298,200 6,923,313
Rio Alto Exploration Ltd. (a) 148,600 1,397,955
St. Laurent Paperboard, Inc. (a) 295,900 4,779,527
138,182,434

SHARES VALUE (NOTE 1)
DENMARK - 0.8%
Den Danske Bank Group AS 101,800 $ 11,475,665
International Service Systems AS,
Series B (a) 211,740 6,418,807
Novo-Nordisk AS Class B 58,900 6,370,478
Sophus Berendsen AS, Series B 22,100 3,332,927
Unidanmark AS Class A 41,200 2,780,349
30,378,226
FINLAND - 2.3%
Cultor OY, Series 1 109,700 5,613,149
Enso OY Class R 864,200 8,176,443
Huhtamaki Ord. 281,700 11,585,654
Metsa-Serla Ltd. Class B 1,247,100 11,076,772
Nokia Corp. AB, Series A 61,900 5,402,356
Outokumpu OY Class A 612,300 9,162,628
Pohjola Class B 228,470 8,822,939
Rauma OY 52,804 994,090
UPM-Kymmene Corp. 565,600 12,722,997
Valmet OY 816,115 12,764,108
86,321,136
FRANCE - 12.1%
Alcatel Alsthom Compagnie Generale
d'Electricite SA 659,300 79,431,672
Axa SA 208,565 14,260,670
Axime SA Ex Segin (a) 61,800 6,878,612
Cap Gemini Sogeti SA 183,300 14,532,132
Carrefour Supermarche SA 18,300 9,534,962
Compagnie de Saint Gobain 29,000 4,156,519
Generale des Eaux, Cie 36,100 4,193,060
Credit Commercial de France Ord. 167,500 9,475,415
Elf Sanofi SA 70,800 6,716,070
Eramet SA 188,438 7,502,357
Groupe Danone 10,000 1,526,757
Lafarge SA 77,000 4,803,711
Lagardere S.C.A. (Reg.) 198,800 5,709,054
Michelin SA (Compagnie Generale des
Etablissements) Class B 213,389 10,929,955
Nationale Elf Aquitaine 257,800 31,862,696
Pechiney SA Class A 595,625 24,456,201
Rhone Poulenc SA Class A 1,753,425 76,335,503
Societe Generale Class A 208,300 28,485,100
Total SA Class B 770,890 85,403,128
Union Assurances Federale SA 48,100 5,370,394
Usinor Sacilor 974,500 16,109,669
Valeo SA 112,200 7,471,649
455,145,286
GERMANY - 3.4%
Allianz Aktiengesellschaft Holdings (Reg.) 51,800 11,666,261
BASF AG 292,500 9,987,391
Bayer AG 325,700 11,479,745
(BMW) Muenchen Bayerische
Motorenweke AG 4,200 3,087,304
BHF Bank (Bank Berlin Hand) 206,650 6,229,449
Buderus AG 3,925 1,902,203
Continental Gummi-Werke AG 247,800 5,954,383
Daimler-Benz AG Ord. 290,000 19,467,826
Deutsche Bank AG 46,000 3,022,667
Dresdner Bank AG Ord. 54,500 2,236,870
Hoechst AG Ord. 478,800 18,291,548
Lufthansa Deutsche AG (Reg.) 295,800 5,290,104
Mannesmann AG Ord. 28,100 11,891,594
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
GERMANY - CONTINUED
Philipp Holzmann AG (a) 5,700 $ 1,619,130
Siemens AG 71,700 4,389,287
Veba AG Ord. 188,400 10,512,174
127,027,936
HONG KONG - 0.5%
China Light & Power Co. Ltd. 720,000 3,790,944
China Telecom (Hong Kong) Ltd. (a) 3,218,000 5,141,307
Great Eagle Holdings Ltd. 960,000 1,465,459
Hutchison Whampoa Ltd. Ord. 462,000 3,197,542
National Mutual Asia Ltd. 2,008,000 1,818,370
Peregrine Investments Holdings Ltd. 2,084,000 2,048,952
Vtech Holdings Ltd. 506,000 988,435
18,451,009
INDIA - 0.1%
Mahindra & Mahindra Ltd. GDR 126,500 1,265,000
State Bank of India GDR (Reg.) 72,200 1,263,500
2,528,500
INDONESIA - 0.2%
PT Matahari Putra Prima 7,368,000 1,432,668
PT Matahari Putra Prima
rights 12/31/97 (a) 14,736,000 818,667
PT Multipolar 26,010,538 2,348,177
PT Putra Surya Multidana (a) 3,369,500 1,169,966
5,769,478
IRELAND - 1.1%
Bank of Ireland, Inc. 1,540,400 19,328,238
CRH PLC 265,000 3,157,849
Independent Newspapers PLC 1,609,950 8,756,317
Smurfit (Jefferson) Group PLC 1,465,700 4,292,486
Smurfit (Jefferson) Group PLC (New) 1,876,100 5,441,086
40,975,976
ITALY - 1.4%
Credito Italiano Ord. 5,129,700 13,730,174
Eni Spa 3,810,000 21,532,066
Telecom Italia Spa 383,330 2,397,524
Telecom Italia Mobile Spa 3,629,300 13,396,676
51,056,440
JAPAN - 20.0%
Acom Co. Ltd. 205,300 11,253,987
Amway Japan Ltd. 310,200 8,141,462
Asahi Breweries Ltd. 95,000 1,404,485
Bank of Tokyo-Mitsubishi Ltd. 611,000 7,967,359
Canon, Inc. 633,000 15,351,828
Circle K Japan Co. Ltd. 24,000 1,231,894
Citizen Watch Co. Ltd. Ord. 859,000 5,479,336
Dai-Ichi Kangyo Bank 237,000 2,007,807
Daiichi Pharmaceutical Co. Ltd. 186,000 2,641,694
Daiwa House Industry Co. Ltd. 433,000 4,171,761
Daiwa Securities Co. Ltd. 1,418,000 8,573,954
Denso Corp. 202,000 4,362,126
Denny's Japan Co. Ltd. 144,000 3,743,522
Daito Trust Construction Co. 643,700 5,720,590
Fuji Bank Ltd. 930,000 8,033,223
Fuji Heavy Industries Ltd. 677,000 2,693,380
Fuji International Trust unit sponsored
ADR (c) 107 2,742,532
Fuji Photo Film Co. Ltd. 1,025,000 37,117,941

SHARES VALUE (NOTE 1)
Fujitsu Ltd. 1,308,000 $ 14,340,200
Hitachi Ltd. 1,192,000 9,157,807
Hitachi Maxell Ltd. 597,000 13,288,705
Honda Motor Co. Ltd. 809,000 27,213,040
Ibiden Co. Ltd. 302,000 5,016,611
Ito-Yokado Co. Ltd. 204,000 10,132,226
Jafco Co. Ltd. 87,000 4,118,771
Jusco Co. Ltd. 223,000 4,982,309
Kao Corp. 574,000 8,009,302
Kobe Steel Ltd. Ord. (a) 1,541,000 1,855,856
Komatsu Ltd. Ord. 2,515,000 13,431,437
Kyocera Corp. 109,000 6,237,625
Long Term Credit Bank of Japan
Ltd. (The) 3,185,000 10,766,570
Matsushita Electric Industrial Co. Ltd. 2,807,000 47,094,187
Matsushita Communication Industrial
Co. Ltd. 175,000 6,177,326
Matsushita Electric Works Co. Ltd. 622,000 5,631,063
Minebea Co. Ltd. 1,583,000 15,777,409
Minolta Camera Co. Ltd. 1,351,000 7,013,082
Mitsubishi Estate Co. Ltd. 783,000 9,885,050
Mitsubishi Heavy Industries Ltd. 736,000 3,612,758
Mitsubishi Trust & Banking Corp. 192,000 2,360,133
Mitsui Fudosan Co. Ltd. 526,000 5,941,528
Murata Manufacturing Co. Ltd. 59,000 2,391,362
Nichiei Co. Ltd. 59,900 6,567,110
Nikko Securities Co. Ltd. 1,031,000 3,724,959
Nintendo Co. Ltd. Ord. 333,700 28,824,585
Nippon Telegraph & Telephone
Corp. Ord. 3,839 32,523,090
Nitto Denko Corp. 46,000 829,070
Nomura Securities Co. Ltd. 1,455,000 16,918,605
Omron Corp. 760,000 12,877,077
Onward Kashiyama & Co. Ltd. 440,000 6,797,342
Orix Corp. 302,900 20,679,718
Ricoh Co. Ltd. Ord. 853,000 10,981,313
Rohm Co. Ltd. 190,000 18,779,070
Sakura Bank Ltd. 4,430,000 18,065,864
Sankyo Co. Ltd. 657,000 21,663,539
Shin-Etsu Chemical Co. Ltd. 215,000 5,250,000
Shinko Electric Industries Co. Ltd. 84,100 3,562,375
Shohkoh Fund & Co. Ltd. 6,800 1,976,744
Sony Corp. 352,200 29,223,240
Sony Music Entertainment Japan, Inc. 140,000 4,918,605
Sumitomo Realty & Development
Co. Ltd. 1,026,000 7,490,482
Sumitomo Sitix Corp. 74,000 1,302,990
TDK Corp. 186,000 15,417,608
Takeda Chemical Industries Ltd. 1,879,000 51,188,705
Takefuji Corp. 30,000 1,333,057
Terumo Corp. 228,000 3,749,502
THK Co. Ltd. 605,300 8,094,128
Toyota Motor Corp. 640,000 17,807,309
Toyo Trust & Banking Co. Ltd. 62,000 462,940
Tokyo Electron Ltd. 200,000 9,966,778
Uni Charm Corp. Ord. 146,000 4,911,130
Uny Co. Ltd. 203,000 3,287,791
World Co. Ltd. 66,500 2,457,849
Xebio Co. Ltd. 70,700 1,139,186
Yamanouchi Pharmaceutical Co. Ltd. 151,000 3,712,292
Yamaha Motor Co. Ltd. 579,000 4,664,701
Yasuda Trust & Banking 1,251,000 3,335,307
751,557,299
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
KOREA (SOUTH) - 0.1%
Korea Electric Power Corp. 354,760 $ 5,036,487
MALAYSIA - 0.1%
Magnum Corp. BHD 722,000 562,513
Malayan Banking BHD 52,000 200,239
Oriental Holdings BHD 1,528,000 3,101,612
Oriental Holdings BHD (New) 466,800 935,690
4,800,054
MEXICO - 0.9%
DESC (Sociedad de Fomento
Industrial SA) Class B 364,000 3,127,446
Grupo Financiero Bancomer Class B (a) 25,232,000 11,893,366
Grupo Carso SA de CV Class A-1 295,000 1,869,272
Grupo Mexico SA, Class L 153,000 452,792
Grupo Financiero Inbursa SA Class B 448,000 1,577,088
Industrias Penoles SA 104,000 412,649
Telefonos de Mexico SA sponsored ADR
representing Ord. Class L shares 245,100 10,600,575
Tubos de Acero de Mexico ADR (a) 174,100 3,514,644
33,447,832
NETHERLANDS - 8.5%
Ahold NV 682,776 17,446,770
AKZO Nobel NV 289,100 50,848,900
Beter Bed Holding NV 75,100 1,633,280
ING Groep NV 695,729 29,152,655
KBB NV Ord. 33,200 2,091,003
KLM Royal Dutch Air Lines NV 126,200 4,269,388
Koninklijke Hoogovens NV 281,800 12,894,704
Koninklijke KNP BT NV 408,900 9,292,226
Koninklijke Pakhoed NV 46,700 1,527,054
New Holland NV 227,000 6,455,313
Nutreco Holding NV (a) 193,959 4,347,873
Philips Electronics NV (Bearer) 889,400 69,505,810
Royal Dutch Petroleum Co. Ord. 921,300 48,646,535
Unilever NV Ord. 709,200 37,629,532
Vendex International NV (c) 219,600 11,967,918
VNU Ord. 484,800 11,465,707
319,174,668
NETHERLANDS ANTILLES - 0.1%
Schlumberger Ltd. 62,400 5,460,000
NEW ZEALAND - 0.1%
Air New Zealand Ltd. Class B 1,054,400 2,230,383
Lion Nathan Ltd. 1,079,500 2,605,850
Lion Nathan Ltd. (Astl.) 112,600 272,337
5,108,570
NORWAY - 0.5%
Den Norske Bank AS Class A
Free shares 1,664,600 7,494,993
Elkem ASA 233,900 3,549,393
NCL Holdings AS (a) 2,335,500 8,918,440
19,962,826
PERU - 0.1%
Compania de Minas Buenaventura SA
Class B sponsored ADR 144,400 2,590,175
PORTUGAL - 0.2%
Electricidade de Portugal SA 446,300 7,826,714
RUSSIA - 0.0%
Vimpel Communications sponsored ADR 43,200 1,414,800

SHARES VALUE (NOTE 1)
SINGAPORE - 0.1%
Kim Engineering Holdings Ltd. 4,882,000 $ 2,234,609
SOUTH AFRICA - 0.4%
Dimension Data Holdings Ltd. (a) 377,400 1,567,601
Gencor Ltd. (Reg.) 302,940 679,492
JCI Ltd. 345,000 1,468,847
Sasol Ltd. 1,076,500 12,967,186
16,683,126
SPAIN - 1.2%
Acerinox SA (Reg.) 27,200 4,053,604
Banco Bilbao Vizcaya SA Ord. (Reg.) 655,600 17,490,460
Telefonica de Espana SA Ord. 935,600 25,473,780
47,017,844
SWEDEN - 6.1%
ABB AB:
Series A 564,300 6,568,174
Series B 270,000 3,106,751
Astra AB Class A Free shares 2,224,933 35,812,024
Assi Doman AB Free shares 115,500 3,226,472
Electrolux AB 160,200 13,212,371
Ericsson (L.M.) Telephone Co. Class B 147,000 6,452,943
Esselte AB Class B Free shares 165,700 3,592,830
Granges AB (Reg.) (a) 89,000 1,450,283
Investor AB Class B Free shares 150,000 6,963,751
Munters AB (a)(c) 240,800 2,434,426
Nordbanken AB 290,700 9,087,396
SKF AB Ord. 225,600 5,221,736
Skandia Foersaekrings AB 470,000 21,882,275
Svenska Cellulosa AB (SCA)
Class B Ord. 185,100 4,136,588
Svenska Handelsbanken 291,500 9,189,957
Swedish Match Co. 11,193,100 34,245,601
Volvo AB Class B 2,352,000 61,322,514
227,906,092
SWITZERLAND - 4.9%
Credit Suisse Group (Reg.) 349,000 49,224,347
Julius Baer Holding AG 11,412 17,054,759
Nestle SA (Reg.) 17,145 24,188,119
Novartis AG (Reg.) 47,808 74,968,140
Roche Holding AG participation
certificates 1,300 11,438,327
Sulzer AG (Reg.) 6,700 4,905,828
SGS Societe Generale de Surveillance
Holding SA (Bearer) 1,500 2,895,960
184,675,480
TURKEY - 0.1%
Tupras-Turkiye Petrol Rafinerileri AS (a) 23,641,200 2,116,963
UNITED KINGDOM - 15.4%
Asda Group PLC 1,291,500 3,350,054
BAT Industries PLC Ord. 2,375,900 20,677,141
BOC Group PLC 93,900 1,576,131
BBA Group PLC 525,500 3,544,080
Barclays PLC Ord. 1,072,000 26,784,301
Barratt Developments PLC 1,542,300 6,530,029
Bass PLC Ord. 461,700 6,397,583
Billiton PLC 1,514,700 4,378,956
Blue Circle Industries PLC 392,000 2,296,042
Boots Co. PLC Class L (The) 586,100 8,435,210
British Aerospace PLC 609,500 16,136,372
British Petroleum PLC Ord. 1,606,719 23,554,276
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
UNITED KINGDOM - CONTINUED
British Land Co. PLC (The) Ord. 335,100 $ 3,897,489
British Telecommunications PLC Ord. 1,612,500 12,224,290
Cable & Wireless PLC Ord. 627,600 4,999,374
Caradon PLC 6,135,790 19,509,665
Cookson Group PLC 8,294,400 33,174,821
Dorling Kindersley Holdings PLC
Class L 337,200 1,608,267
DR Solomons Group PLC
sponsored ADR 286,000 8,758,750
English China Clay PLC 727,700 3,166,295
Gallaher Group PLC 1,748,000 8,337,042
Glaxo Wellcome PLC 1,522,000 32,551,516
Granada Group PLC 573,100 7,883,661
Grand Metropolitan PLC 2,536,311 22,835,499
Guinness PLC Ord. 408,000 3,639,260
HSBC Holdings PLC 648,000 15,181,992
Hays PLC 180,700 2,116,810
ICI (Imperial Chemical Industries) PLC
Class L 243,600 3,587,448
Inchcape PLC Ord. 1,835,000 6,694,502
Ladbroke Group PLC Ord. 2,535,200 11,327,895
Lloyds TSB Group PLC 3,532,896 44,046,646
Mercury Asset Management
Group PLC 147,200 3,220,836
National Grid Co. PLC 1,514,900 7,123,870
Pearson PLC 538,100 7,023,981
Perpetual PLC 36,900 1,395,599
Rentokil Initial PLC 10,073,100 39,614,732
Rugby Group PLC 1,447,600 3,125,101
Royal & Sun Alliance Insurance
Group PLC 887,000 8,483,315
Securicor Group PLC 2,203,900 9,884,447
Shell Transport & Trading Co.
PLC (Reg.) 4,193,400 29,667,142
SmithKline Beecham PLC Ord. 4,290,544 40,568,273
SIG PLC 251,500 1,174,270
Somerfield PLC 1,652,200 5,308,717
Tarmac PLC 1,063,200 2,081,740
Thames Water PLC Ord. 276,300 4,184,612
Tomkins PLC Ord. 339,700 1,739,573
Unigate PLC 605,500 5,846,766
Unilever PLC Ord. 1,960,800 14,569,411
Vodafone Group PLC 3,823,738 20,828,828
WPP Group PLC 480,900 2,189,018
577,231,628
UNITED STATES OF AMERICA - 1.3%
Alumax, Inc. (a) 229,997 7,474,903
Aluminum Co. of America 227,400 16,600,200
D.R. Horton, Inc. 356,100 5,341,500
MCI Communications Corp. 301,200 10,692,600
Newmont Mining Corp. 83,800 2,933,000
Pharmacia & Upjohn, Inc. 178,900 5,675,776
48,717,979
TOTAL COMMON STOCKS
(Cost $2,869,144,288) 3,342,513,196
CLOSED-END INVESTMENT COMPANIES - 0.5%
SHARES VALUE (NOTE 1)
EMERGING MARKETS - 0.2%
TCW/DW Emerging Markets
Opportunities Trust (SBI) 157,300 $ 1,956,419
Templeton Dragon Fund, Inc. 359,000 4,599,688
6,556,107
GERMANY - 0.3%
Emerging Germany Fund, Inc. 134,100 1,424,813
New Germany Fund, Inc. (The) 662,700 9,899,081
11,323,894
MULTI-NATIONAL - 0.0%
Morgan Stanley Asia-Pacific Fund, Inc. 157,000 1,265,813
TOTAL CLOSED-END INVESTMENT COMPANIES
(Cost $20,393,908) 19,145,814
PREFERRED STOCKS - 1.9%
CONVERTIBLE PREFERRED STOCKS - 0.3%
AUSTRALIA - 0.1%
National Australia Bank Ltd. 7.8750% 164,400 4,572,375
JAPAN - 0.1%
AJL participating trust $1.44 131,300 1,920,263
UNITED STATES OF AMERICA - 0.1%
WBK STRYPES Trust $3.135 167,700 5,198,700
TOTAL CONVERTIBLE PREFERRED STOCKS 11,691,338
NONCONVERTIBLE PREFERRED STOCKS - 1.6%
AUSTRALIA - 0.0%
Sydney Harbour Casino Holdings Ltd. (a) 1,399,100 1,422,217
GERMANY - 0.4%
SAP (Systeme Anwendungen
Produkte) AG 36,800 10,981,333
Wella AG 5,000 3,507,246
14,488,579
ITALY - 1.2%
Telecom Italia Spa 6,992,000 28,154,809
Telecom Italia Mobile Spa de Risp 7,502,100 15,330,388
43,485,197
TOTAL NONCONVERTIBLE PREFERRED STOCKS 59,395,993
TOTAL PREFERRED STOCKS
(Cost $47,621,152) 71,087,331
GOVERNMENT OBLIGATIONS - 0.1%
PRINCIPAL
AMOUNT
UNITED STATES OF AMERICA - 0.0%
U.S. Treasury Bill, yield at date of purchase
5.28% to 5.30%, 1/08/98 (d)
(Cost $1,634,434) $ 1,650,000 1,634,434
CASH EQUIVALENTS - 8.5%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $319,837,207) 319,837,207 $ 319,837,207
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $3,258,630,989) $ 3,754,217,982
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
166 Nikkei 225 Stock
Index Contracts Dec 97 $ 13,620,300 $ (1,821,988)
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL
INVESTMENT IN SECURITIES - 0.4%
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$20,446,910 or 0.5% of net assets.
(d) A portion of the security was pledged to cover margin requirements
for futures contracts. At the period end, the value of securities
pledged amounted to $465,500.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $2,336,195,375 and $2,132,582,785, respectively (see Note 3
of Notes to Financial Statements).
The market value of futures contracts opened and closed during the
period amounted to $139,409,532 and $132,740,035, respectively (see
Note 2 of Notes to Financial Statements).
The fund participated in the bank borrowing program. The maximum loan
and average daily balance during the period for which the loan was
outstanding amounted to $2,020,000. The weighted average interest rate
was 5.9% (see Note 5 of Notes to Financial Statements).
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of Fidelity Management & Research Company.
The commissions paid to these affiliated firms were $626,425 for the
period (see Note 4 of Notes to Financial Statements).
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $3,262,529,491. Net unrealized appreciation
aggregated $491,688,491, of which $732,863,292 related to appreciated
investment securities and $241,174,801 related to depreciated
investment securities.
The fund hereby designates approximately $126,103,000 as a capital
gain dividend for the purpose of the dividend paid deduction.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.4%
Basic Industries 9.9
Cash Equivalents 8.5
Construction & Real Estate 3.1
Durables 9.9
Energy 7.6
Finance 16.4
Health 9.9
Holding Companies 1.5
Industrial Machinery & Equipment 4.9
Media & Leisure 2.7
Nondurables 5.0
Precious Metals 0.5
Retail & Wholesale 3.2
Services 2.2
Technology 6.5
Transportation 0.5
Utilities 7.3
100.0%
OVERSEAS
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE (COST $3,258,630,989) - SEE ACCOMPANYING SCHEDULE $ 3,754,217,982

CASH 1,743,574

RECEIVABLE FOR INVESTMENTS SOLD 79,572,171

RECEIVABLE FOR FUND SHARES SOLD 48,834,146

DIVIDENDS RECEIVABLE 9,853,919

INTEREST RECEIVABLE 1,792,561

RECEIVABLE FOR DAILY VARIATION ON FUTURES CONTRACTS 244,850

OTHER RECEIVABLES 51,922

TOTAL ASSETS 3,896,311,125

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 64,838,305

PAYABLE FOR FUND SHARES REDEEMED 48,917,208

ACCRUED MANAGEMENT FEE 2,972,252

OTHER PAYABLES AND 2,131,121
ACCRUED EXPENSES

TOTAL LIABILITIES 118,858,886

NET ASSETS $ 3,777,452,239

NET ASSETS CONSIST OF:

PAID IN CAPITAL $ 2,996,113,296

UNDISTRIBUTED NET INVESTMENT INCOME 41,157,042

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN 246,302,692
CURRENCY TRANSACTIONS

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 493,879,209
AND ASSETS AND LIABILITIES IN FOREIGN CURRENCIES

NET ASSETS, FOR 110,720,055 SHARES OUTSTANDING $ 3,777,452,239

NET ASSET VALUE, OFFERING PRICE $34.12
AND REDEMPTION PRICE PER SHARE ($3,777,452,239 (DIVIDED BY) 110,720,055 SHARES)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 75,067,827
DIVIDENDS

INTEREST 21,652,187

96,720,014

LESS FOREIGN TAXES WITHHELD (8,108,687)

TOTAL INCOME 88,611,327

EXPENSES

MANAGEMENT FEE $ 26,697,997
BASIC FEE

PERFORMANCE ADJUSTMENT 3,286,953

TRANSFER AGENT FEES 10,216,855

ACCOUNTING FEES AND EXPENSES 813,270

NON-INTERESTED TRUSTEES' COMPENSATION 22,948

CUSTODIAN FEES AND EXPENSES 1,686,388

REGISTRATION FEES 280,725

AUDIT 103,318

LEGAL 31,681

INTEREST 999

REPORTS TO SHAREHOLDERS 586,300

MISCELLANEOUS 74,920

TOTAL EXPENSES BEFORE REDUCTIONS 43,802,354

EXPENSE REDUCTIONS (799,735) 43,002,619

NET INVESTMENT INCOME 45,608,708

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 260,143,969

FOREIGN CURRENCY TRANSACTIONS (73,155)

FUTURES CONTRACTS (4,772,207) 255,298,607

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 240,532,449

ASSETS AND LIABILITIES IN 99,516
FOREIGN CURRENCIES

FUTURES CONTRACTS (1,338,939) 239,293,026

NET GAIN (LOSS) 494,591,633

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 540,200,341

OTHER INFORMATION $ 483,873
EXPENSE REDUCTIONS
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 1,986

TRANSFER AGENT CREDITS 313,876

$ 799,735

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 45,608,708 $ 48,199,048
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 255,298,607 208,828,408

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 239,293,026 20,311,637

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 540,200,341 277,339,093

DISTRIBUTIONS TO SHAREHOLDERS (36,606,761) (27,336,910)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (161,278,875) (28,141,138)

TOTAL DISTRIBUTIONS (197,885,636) (55,478,048)

SHARE TRANSACTIONS 4,490,417,585 2,267,210,371
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 192,007,203 53,404,640

COST OF SHARES REDEEMED (4,361,912,739) (1,704,156,879)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 320,512,049 616,458,132

TOTAL INCREASE (DECREASE) IN NET ASSETS 662,826,754 838,319,177

NET ASSETS

BEGINNING OF PERIOD 3,114,625,485 2,276,306,308

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $41,157,042 AND
$35,462,219, RESPECTIVELY) $ 3,777,452,239 $ 3,114,625,485

OTHER INFORMATION
SHARES

SOLD 132,727,973 75,173,719

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 6,343,151 1,869,255

REDEEMED (128,555,588) (56,502,435)

NET INCREASE (DECREASE) 10,515,536 20,540,539

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 E 1993

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 31.08 $ 28.57 $ 29.17 $ 27.16 $ 21.96

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .43 D .48 H .31 .18 .27

NET REALIZED AND UNREALIZED GAIN (LOSS) 4.61 2.72 (.44) 2.26 7.40

TOTAL FROM INVESTMENT OPERATIONS 5.04 3.20 (.13) 2.44 7.67

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.37) (.34) (.02) (.15) (.37)

IN EXCESS OF NET INVESTMENT INCOME - - - (.17) -

FROM NET REALIZED GAIN (1.63) (.35) (.45) (.11) (2.10) B

TOTAL DISTRIBUTIONS (2.00) (.69) (.47) (.43) (2.47)

NET ASSET VALUE, END OF PERIOD $ 34.12 $ 31.08 $ 28.57 $ 29.17 $ 27.16

TOTAL RETURN A 17.03% 11.41% (.34)% 9.13% C 39.01% C

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 3,777,452 $ 3,114,625 $ 2,276,306 $ 2,283,211 $ 1,490,666

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.23% 1.14% 1.05% 1.24% 1.27%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER
EXPENSE REDUCTIONS 1.20% F 1.12% F 1.05% 1.24% 1.27%

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.28% 1.74% 1.78% .90% 1.00%

PORTFOLIO TURNOVER RATE 68% 82% 49% 49% 64%

AVERAGE COMMISSION RATE G $ .0109 $ .0134

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO
FINANCIAL STATEMENTS). B INCLUDES AMOUNTS DISTRIBUTED FROM NET
REALIZED GAINS ON FOREIGN CURRENCY RELATED TRANSACTIONS
TAXABLE AS ORDINARY INCOME. C TOTAL RETURNS DO NOT INCLUDE THE
ONE TIME SALES CHARGE. D NET INVESTMENT INCOME PER SHARE HAS
BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING DURING THE
PERIOD. E EFFECTIVE NOVEMBER 1, 1993, THE FUND
ADOPTED STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE,
AND FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN,
AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES." AS
A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. F FMR OR
THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES
(SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS). G FOR FISCAL
YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED
TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY
FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX
OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING PRACTICES
AND COMMISSION RATE STRUCTURES MAY DIFFER. H INVESTMENT INCOME
PER SHARE REFLECTS A SPECIAL DIVIDEND WHICH AMOUNTED TO $.08 PER SHARE.

</TABLE>

WORLDWIDE
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). If Fidelity had not reimbursed certain fund
expenses, the life of fund total returns would have been lower. Prior
to July 1, 1995, the fund imposed a 3% sales charge. If this sales
charge were taken into account, total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

WORLDWIDE 17.95% 108.35% 104.67%

MORGAN STANLEY CAPITAL 16.77% 103.29% 97.28%
INTERNATIONAL WORLD INDEX

GLOBAL FUNDS AVERAGE 16.50% 96.26% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on May 30, 1990. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. You can compare the fund's returns to
the performance of the Morgan Stanley Capital International World
Index - a market capitalization weighted equity index of over 1,500
stocks traded in 22 world markets. To measure how the fund's
performance stacked up against its peers, you can compare it to the
global funds average, which reflects the performance of mutual funds
with similar objectives tracked by Lipper Analytical Services, Inc.
The past one year average represents a peer group of 175 mutual funds.
These benchmarks include reinvested dividends and capital gains, if
any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

WORLDWIDE 17.95% 15.81% 10.12%

MORGAN STANLEY CAPITAL 16.77% 15.24% 9.58%
INTERNATIONAL WORLD INDEX

GLOBAL FUNDS AVERAGE 16.50% 14.19% N/A

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19971031 19971124 122433 S00000000000001
Worldwide Fund MS World Index (Net)
00318 MS004
1990/05/30 10000.00 10000.00
1990/05/31 10030.00 9976.64
1990/06/30 10290.00 9902.62
1990/07/31 10570.00 9989.88
1990/08/31 9380.00 9051.77
1990/09/30 8450.00 8094.23
1990/10/31 8950.00 8846.73
1990/11/30 8950.00 8698.31
1990/12/31 8898.23 8877.31
1991/01/31 9150.44 9198.82
1991/02/28 9654.88 10047.22
1991/03/31 9321.95 9748.02
1991/04/30 9412.75 9821.21
1991/05/31 9483.37 10040.73
1991/06/30 8807.43 9417.84
1991/07/31 9352.22 9859.59
1991/08/31 9493.46 9825.22
1991/09/30 9654.88 10079.83
1991/10/31 9695.23 10240.21
1991/11/30 9180.71 9790.88
1991/12/31 9599.06 10500.46
1992/01/31 9701.07 10302.97
1992/02/29 9996.89 10122.11
1992/03/31 9762.27 9642.19
1992/04/30 10190.71 9773.45
1992/05/31 10619.15 10159.10
1992/06/30 10251.92 9815.63
1992/07/31 10149.91 9837.48
1992/08/31 10007.10 10073.46
1992/09/30 10007.10 9977.88
1992/10/31 9823.48 9704.42
1992/11/30 9976.49 9874.98
1992/12/31 10194.86 9951.68
1993/01/31 10530.15 9981.98
1993/02/28 10781.62 10215.46
1993/03/31 11399.81 10804.71
1993/04/30 11682.71 11302.49
1993/05/31 12049.43 11559.98
1993/06/30 11923.70 11460.02
1993/07/31 12185.64 11693.15
1993/08/31 12950.52 12226.26
1993/09/30 12814.31 11997.44
1993/10/31 13369.63 12325.16
1993/11/30 13128.64 11625.06
1993/12/31 13920.64 12191.05
1994/01/31 14914.21 12992.28
1994/02/28 14689.86 12821.27
1994/03/31 14134.32 12265.65
1994/04/30 14625.76 12641.94
1994/05/31 14604.39 12671.61
1994/06/30 14305.25 12633.52
1994/07/31 14743.28 12870.80
1994/08/31 14989.00 13255.48
1994/09/30 14700.54 12904.26
1994/10/31 14914.21 13268.36
1994/11/30 14401.40 12689.97
1994/12/31 14332.82 12809.88
1995/01/31 14253.69 12614.52
1995/02/28 14423.25 12795.36
1995/03/31 14502.37 13408.98
1995/04/30 14864.08 13873.19
1995/05/31 15011.03 13988.72
1995/06/30 15214.49 13981.28
1995/07/31 15836.18 14677.67
1995/08/31 15440.56 14347.51
1995/09/30 15587.50 14762.30
1995/10/31 15056.24 14526.70
1995/11/30 15101.46 15027.93
1995/12/31 15363.09 15464.12
1996/01/31 15786.03 15740.67
1996/02/29 15991.79 15833.30
1996/03/31 16266.13 16093.49
1996/04/30 16746.23 16468.62
1996/05/31 17043.43 16479.56
1996/06/30 17032.00 16559.58
1996/07/31 16414.73 15971.03
1996/08/31 16849.10 16151.29
1996/09/30 17169.17 16780.32
1996/10/31 17352.06 16894.13
1996/11/30 18152.22 17837.53
1996/12/31 18239.31 17548.51
1997/01/31 18464.49 17756.70
1997/02/28 18974.10 17957.61
1997/03/31 18725.22 17599.05
1997/04/30 18689.67 18170.96
1997/05/31 19791.85 19289.22
1997/06/30 20834.77 20247.97
1997/07/31 21699.92 21177.22
1997/08/31 20538.49 19757.23
1997/09/30 22150.28 20827.25
1997/10/31 20467.38 19727.72
IMATRL PRASUN SHR__CHT 19971031 19971124 122435 R00000000000093
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Worldwide Fund on May 30, 1990, when the fund
started. As the chart shows, by October 31, 1997, the value of the
investment would have grown to $20,467 - a 104.67% increase on the
initial investment. For comparison, look at how the Morgan Stanley
Capital International World Index did over the same period. With
dividends and capital gains, if any, reinvested, the same $10,000
would have grown to $19,728 - a 97.28% increase.

An interview with Penny Dobkin, Portfolio Manager of
Fidelity Worldwide Fund
Q. HOW DID THE FUND PERFORM, PENNY?
A. Pretty well. The fund returned 17.95% for the 12-month period that
ended October 31, 1997. For the same time period, the global funds
average, as tracked by Lipper Analytical Services, was up 16.50%,
while the Morgan Stanley Capital International World Index returned
16.77%.
Q. WHY DID THE FUND SLIGHTLY OUTPERFORM THE INDEX OVER THE PERIOD?
A. There were a number of reasons. In brief, the fund was
underweighted compared to the index in some of the world's
poorest-performing markets and overweighted versus the index in some
of the world's strongest markets. Specifically, the fund was
underweighted in the weak Japanese market and had very small holdings
in Southeast Asia during a period of extreme market volatility there
in October. On the other hand, the fund was overweighted compared to
the index in the solidly performing European markets. In addition, it
was overweighted in three emerging markets - Mexico, Russia and Turkey
- - that were quite strong over the period.
Q. LET'S DISCUSS WHY YOU UNDERWEIGHTED JAPAN . . .
A. It was mainly because there continued to be no domestic economic
pickup. I should note, however, that the fund's investments in
Japanese exporters, such as Matsushita Communications and Minebea,
continued to do well over the period. On the other hand, I decreased
the fund's investment in Honda - a Japanese exporter that was the
fund's largest holding six months ago - after domestic sales turned
negative in the summer.
Q. AND SOUTHEAST ASIA, WHERE THE MARKET WAS SO VOLATILE THIS OCTOBER .
. .
A. As of the end of September, the fund had less than 2% invested in
Southeast Asia, which was all in Hong Kong. In fact, I started selling
the fund's holdings in Hong Kong in July and August. Given the demise
of Thailand and Malaysia earlier this year, I thought it was just a
matter of time before investors decided to take profits out of Hong
Kong, or before the region's economic turmoil would spread to Hong
Kong.
Q. HOW DID YOU POSITION THE FUND'S HOLDINGS IN EUROPE?
A. The fund continued to be overweighted in Europe compared to the
index, which paid off for shareholders. Europe continued to provide a
positive investment environment - inflation was low, interest rates
didn't move and economic activity continued to accelerate. In
addition, there were still a lot of companies that were restructuring
in order to improve profitability and shareholder value. Two of these
companies that we discussed in some depth six months ago - consumer
products company Unilever and Swiss bank Julius Baer - still looked
good at the end of the period. Another of the fund's top 10 holdings
that benefited from restructuring measures was French defense
electronics company Alcatel Alsthom.
Q. WERE THERE ANY OTHER STORIES OF NOTE IN EUROPE?
A. Yes, there were. Some of the fund's investments in the paper and
forest products sector paid off for the fund. Dutch company KNP -
which comprises a paper products division and an office supplies
division - benefited from an upturn in the paper and forest products
sector and did quite well for most of the period. I should note that
this sector was hurt somewhat by the tumble in the Asian stock markets
because of concerns that paper demand in Southeast Asia would decrease
and paper would be exported to the U.S. and Europe, thereby delaying
the time when paper prices could rise again. In addition, the fund
held some select European stocks that did extremely well.
Netherlands-based consumer electronics company Philips Electronics was
the fund's top holding and its most profitable one over the period. It
performed well because after years of taking out costs, the company
decided to focus on profitability, and its earnings took off.
Q. YOU MENTIONED THAT THE FUND ALSO DID WELL WITH ITS INVESTMENTS IN
SOME EMERGING MARKETS, ESPECIALLY MEXICO, RUSSIA AND TURKEY . . .
A. Selected emerging markets turned in strong performances this year.
Mexican banks began looking quite good when the economy started
recovering earlier this year. The fund owned a number of the country's
top-performing banks, including Bancomer and BANACCI, even before the
Mexican economy's recovery because they were so inexpensive. As a
result, when the economy stabilized and the banks' loan growth
resumed, these companies turned in excellent performances. In Russia,
the fund only held a couple of names - cellular operator Vimpel Comm
and oil producer Tatneft. Those names benefited from an extremely
strong Russian market that was up 139% in dollar terms over the past
year. In terms of Turkey, the fund benefited from its investment in
some initial public offerings (IPOs) that turned in strong
performances, most notably conglomerate Haci Omer Sabanci and bank
Yapi Ve Kredi Bankasi. Before investing in these companies, we met
with their management teams and were very impressed. They spoke
English fluently and used sophisticated business management
techniques. These stocks were cheap, selling at five times earnings,
and the companies were growing at 20% or 30% a year. Another Turkish
company, media conglomerate Dogan Sirketler, was one of the fund's
best-performing stocks over the period.
Q. WERE THERE INVESTMENT DECISIONS YOU REGRET MAKING OVER THE PERIOD?
A. One of the fund's top 10 holdings, Finnish metal company Outokumpu,
didn't work out because the drop in the Asian markets caused metal
prices to head south. If I had known the impact of Southeast Asia on
commodities and commodity stocks, I certainly would not have held this
stock. In hindsight, I also wish I hadn't owned Long Term Credit Bank
in Japan. The financial sector, like the rest of the economy, turned
in a very poor performance.
Q. PENNY, WHAT'S THE OUTLOOK FOR THE FUND?
A. Going forward, I think most investors will try to return to stocks
that they consider safe and secure. However, I think this trend will
not be long-lived. In fact, I expect investors to take on stocks with
a somewhat higher risk level over the next few months, especially
those in parts of the world they're comfortable with, such as Europe,
or places that are showing growth, such as Latin America. I still
think it will be a long time before most investors put money back into
Southeast Asia. Looking ahead, my overall strategy will be to pretty
much sit tight. However, I expect to look for potential investments in
improving economies, such as South Africa, and in companies that don't
have ties to Southeast Asia.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
CANADA 5.8%
ROW: 1, COL: 1, VALUE: 23.8
ROW: 1, COL: 2, VALUE: 7.2
ROW: 1, COL: 3, VALUE: 4.3
ROW: 1, COL: 4, VALUE: 3.6
ROW: 1, COL: 5, VALUE: 23.5
ROW: 1, COL: 6, VALUE: 7.6
ROW: 1, COL: 7, VALUE: 9.800000000000001
ROW: 1, COL: 8, VALUE: 8.800000000000001
ROW: 1, COL: 9, VALUE: 5.6
ROW: 1, COL: 10, VALUE: 5.8
FINLAND 5.6%
UNITED STATES 23.8%
FRANCE 8.8%
JAPAN 9.8%
UNITED
KINGDOM 7.2%
SWITZERLAND 4.3%
NETHERLANDS 7.6%
TURKEY 3.6%
OTHER 23.5%
AS OF APRIL 30, 1997
CANADA 6.0%
ROW: 1, COL: 1, VALUE: 34.0
ROW: 1, COL: 2, VALUE: 4.1
ROW: 1, COL: 3, VALUE: 4.2
ROW: 1, COL: 4, VALUE: 4.4
ROW: 1, COL: 5, VALUE: 19.5
ROW: 1, COL: 6, VALUE: 5.8
ROW: 1, COL: 7, VALUE: 10.0
ROW: 1, COL: 8, VALUE: 3.1
ROW: 1, COL: 9, VALUE: 8.9
ROW: 1, COL: 10, VALUE: 6.0
UNITED STATES 34.0%
FRANCE 8.9%
HONG KONG 3.1%
JAPAN 10.0%
NETHERLANDS 5.8%
UNITED
KINGDOM 4.1%
SWITZERLAND 4.2%
SPAIN 4.4%
OTHER 19.5%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 94.5 85.3

SHORT-TERM INVESTMENTS 5.5 14.7

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

PHILIPS ELECTRONICS NV (BEARER) 1.7 1.2
(NETHERLANDS, CONSUMER ELECTRONICS)

KONINKLIJKE KNP BT NV 1.6 1.0
(NETHERLANDS, PAPER & FOREST PRODUCTS)

CIBA SPECIALTY CHEMICALS AG 1.4 0.0
(SWITZERLAND, CHEMICALS & PLASTICS)

HACI OMER SABANCI HOLDING AS 1.4 0.0
(TURKEY, HOLDING COMPANIES)

BCE, INC. 1.4 1.3
(CANADA, TELEPHONE SERVICES)

SULZER AG (REG.) 1.3 1.3
(SWITZERLAND, INDUSTRIAL MACHINERY &
EQUIPMENT)

YAPI VE KREDI BANKASI AS 1.3 0.0
(TURKEY, BANKS)

ALCATEL ALSTHOM COMPAGNIE GENERALE 1.3 1.0
D'ELECTRICITE SA SPONSORED ADR
(FRANCE, ELECTRICAL EQUIPMENT)

UNILEVER PLC ORD. 1.3 1.2
(UNITED KINGDOM, HOUSEHOLD PRODUCTS)

OUTOKUMPU OY CLASS A 1.2 0.0
(FINLAND, METALS & MINING)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

BASIC INDUSTRIES 18.6 12.9

FINANCE 14.6 13.6

INDUSTRIAL MACHINERY & EQUIPMENT 8.3 7.4

DURABLES 7.7 7.3

NONDURABLES 6.9 5.4

UTILITIES 6.5 4.9

RETAIL & WHOLESALE 6.2 7.9

CONSTRUCTION & REAL ESTATE 6.0 8.0

MEDIA & LEISURE 5.5 3.3

TECHNOLOGY 5.4 5.9

WORLDWIDE
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 91.3%
SHARES VALUE (NOTE 1)
ARGENTINA - 0.1%
Bansud SA Class B (a) 110,300 $ 982,225
AUSTRALIA - 1.0%
Boral Ltd. Ord. 1,150,000 3,015,216
CSR Ltd. 763,735 2,645,493
Capral Aluminum Ltd. 727,000 1,732,855
Comalco Ltd. 930,000 3,794,503
11,188,067
AUSTRIA - 1.1%
OMV AG 33,621 4,780,237
Voest-Alpine Stahl AG 172,000 7,442,819
12,223,056
BERMUDA - 0.4%
Terra Nova (Bermuda) Holdings Ltd. 174,300 4,510,013
BRAZIL - 2.4%
Compania Energertica Minas Gerais 226,500,000 9,038,641
Rossi Residencial SA (a) 4,800,000 9,142,028
Telebras sponsored ADR 51,500 5,227,250
Telesp PN (Pfd. Reg.) 16,000,000 4,179,213
Telesp PN rights 11/12/97 (a) 535,002 485
27,587,617
CANADA - 5.8%
Alcan Aluminium Ltd. 65,000 1,846,001
BCE, Inc. 568,000 15,828,748
Canwest Global Communications Corp.
(non-vtg.) 427,800 8,170,556
Dofasco Inc. 268,000 4,833,114
Domtar, Inc. 565,100 4,393,372
Edperbrascan Corp. Ltd., Class A (vtg.) 324,900 5,732,376
Falconbridge Ltd. 590,000 8,901,629
Falconbridge Ltd. (c) 30,000 452,625
Imasco Ltd. 300,000 9,542,405
National Bank of Canada 464,300 6,609,546
66,310,372
CROATIA - 0.1%
Pliva D.D. GDR (c) 50,000 762,500
DENMARK - 0.2%
East Asiatic Co. Ltd. (a) 175,000 2,026,049
FINLAND - 5.6%
Cultor OY Ord., Series 2 165,000 8,825,063
Enso OY Class R 850,000 8,042,093
Huhtamaki Ord. 190,000 7,814,250
KCI (Konecranes International) (c) 120,550 4,538,955
Merita Ltd. Class A 1,100,000 5,373,624
Metsa-Serla Ltd. Class B 750,000 6,661,518
Outokumpu OY Class A 919,400 13,758,158
UPM-Kymmene Corp. 375,000 8,435,509
63,449,170
FRANCE - 8.8%
Alcatel Alsthom Compagnie Generale
d'Electricite SA sponsored ADR (a) 588,900 14,317,631
Carbonne-Lorraine (LE) 23,200 6,144,419
Credit Commercial de France Ord. 118,400 6,697,846
Eramet SA 128,374 5,111,005
France Telecom SA 9,800 370,323
Galeries Lafayette SA 15,700 7,337,782
Lagardere S.C.A. 350,000 10,051,152
Metaleurop SA (a) 522,665 5,482,737

SHARES VALUE (NOTE 1)
Pechiney SA Class A 189,959 $ 7,799,665
Rhone Poulenc SA Class A 265,000 11,536,797
Societe Fonciere Lyonnaise SA 66,000 7,997,300
(SGE) Societe Generale
d'Entreprises SA 287,620 7,358,595
Societe Generale Class A 30,000 4,102,511
Suez Lyonnaise des Eaux 52,000 5,391,772
99,699,535
GERMANY - 0.4%
BERU AG (d) 240,000 5,078,261
GREECE - 0.9%
Hellenic Telecommunications
Organizations SA 493,000 10,280,996
HONG KONG - 1.0%
Amoy Properties Ltd. 4,206,000 3,618,357
China Telecom (Hong Kong) Ltd. (a) 1,974,000 3,153,803
Jardine Strategic Holdings Ltd. Ord. 518,350 1,658,720
Sime Darby Hongkong Ltd. 4,900,000 3,486,417
11,917,297
IRELAND - 1.2%
Independent Newspapers PLC 1,368,800 7,444,732
Smurfit (Jefferson) Group PLC 1,920,100 5,623,253
13,067,985
ITALY - 1.4%
Banca Popolare de Bresica 273,300 2,055,411
Credito Italiano Ord. 3,003,100 8,038,109
Telecom Italia Spa 1,013,110 6,336,461
16,429,981
JAPAN - 9.8%
Asahi Breweries Ltd. 424,000 6,268,439
Daiwa Securities Co. Ltd. 625,000 3,779,070
Fujitsu Ltd. 309,000 3,387,708
Fuji Machine Manufacturing
Co. Ltd. Ord. 223,000 6,464,037
Hanshin Department Store Ltd. 666,000 2,710,465
Honda Motor Co. Ltd. 194,000 6,525,748
Long Term Credit Bank of Japan Ltd. (The) 2,608,000 8,816,080
Matsushita Electric Industrial Co. Ltd. 428,000 7,180,731
Matsushita Communication Industrial
Co. Ltd. 325,000 11,472,176
Matsuya Co. Ltd. 99,000 341,238
Minebea Co. Ltd. 865,000 8,621,263
Minolta Camera Co. Ltd. 859,000 4,459,095
Nikko Securities Co. Ltd. 740,000 2,673,588
Nintendo Co. Ltd. Ord. 45,300 3,912,957
Nomura Securities Co. Ltd. 581,000 6,755,814
Omron Corp. 185,000 3,134,552
Sumitomo Realty & Development Co. Ltd. 480,000 3,504,319
THK Co. Ltd. 831,100 11,113,547
Yamaha Motor Co. Ltd. 971,000 7,822,841
Yamaichi Securities Co. Ltd. 1,589,000 3,009,070
111,952,738
MEXICO - 3.1%
Acer Computec Latino America
sponsored ADR (a)(c) 403,000 6,246,500
BANACCI SA de CV Class B (a) 2,890,000 5,724,821
Corporacion Geo SA de CV (a) 831,649 4,485,744
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
MEXICO - CONTINUED
Grupo Financiero Bancomer SA de CV
sponsored ADR, Series C (a)(c) 1,429,000 $ 13,218,250
Grupo Financiero Bancomer Class B (a) 500,000 235,680
Grupo Financiero Inbursa SA Class B 1,680,000 5,914,081
35,825,076
NETHERLANDS - 6.9%
AKZO Nobel NV 69,400 12,206,550
Koninklijke KNP BT NV 825,000 18,748,072
New Holland NV 420,000 11,943,750
Philips Electronics NV 60,000 4,702,500
Philips Electronics NV (Bearer) 242,500 18,951,157
Samas-Groep NV 193,613 8,809,640
Volker Wessels Stevin NV 120,000 3,640,103
79,001,772
NORWAY - 0.6%
Elkem ASA 451,200 6,846,884
RUSSIA - 1.0%
Tatneft AO sponsored ADR (c) 21,500 3,031,500
Vimpel Communications sponsored ADR 266,600 8,731,150
11,762,650
SOUTH AFRICA - 2.2%
Amalgamated Banks of South Africa Ltd. 1,900,000 11,246,106
NBS Boland Group Ltd. 350,300 698,417
Orion Selections Ltd. 1,130,000 2,229,491
Orion Selections Holdings Ltd. 1,500,000 3,738,318
Sasol Ltd. 616,400 7,424,964
25,337,296
SPAIN - 1.9%
Banco De Valencia SA (Reg.) 182,400 3,659,008
Catalana Occidente SA 88,500 4,479,322
Cristaleria Espanola SA 100,400 7,505,384
FOCSA (Fomento Construcciones y
Contratas SA) 164,588 6,038,994
21,682,708
SWEDEN - 2.3%
Castellum AB (a) 961,400 8,952,178
Hemkopskedjan AB Series B (a) 509,000 5,247,423
Karlshamns AB (a) 193,000 2,618,690
Rottneros Bruk AB Free shares 1,850,000 1,673,429
Svenska Cellulosa AB (SCA)
Class B Ord. 140,000 3,128,700
Volvo AB Class B 170,000 4,432,325
26,052,745
SWITZERLAND - 4.3%
Ciba Specialty Chemicals AG (a) 165,000 16,222,739
Julius Baer Holding AG 6,200 9,265,642
Schindler Holding AG (Reg.) 2,800 3,403,647
SIG AG (Reg.) 3,800 5,053,986
Sulzer AG (Reg.) 20,800 15,230,032
49,176,046
TURKEY - 3.6%
Dogan Sirketler Grubu Holdings AS 207,000,000 8,200,740
Eregli Demir Celik 14,000,000 2,279,340
Haci Omer Sabanci Holding AS (d) 277,425,000 16,109,765
Yapi Ve Kredi Bankasi AS 472,681,000 14,365,343
40,955,188

SHARES VALUE (NOTE 1)
UNITED KINGDOM - 7.2%
Amec PLC Ord. 2,680,500 $ 6,325,002
Billiton PLC 1,000,000 2,890,973
Doncasters PLC sponsored ADR 241,800 6,513,488
English China Clay PLC 1,700,000 7,396,870
Grand Metropolitan PLC 960,000 8,643,293
HSBC Holdings PLC Ord. 170,000 4,224,751
House of Fraser PLC Class L 1,800,000 6,476,445
Ionica PLC (a) 1,604,000 8,321,311
Somerfield PLC 1,970,000 6,329,846
Smith Holdings PLC 2,900,000 11,065,182
Unilever PLC Ord. 1,920,000 14,266,253
82,453,414
UNITED STATES OF AMERICA - 18.0%
AccuStaff, Inc. (a) 260,000 7,426,250
Alaska Air Group, Inc. (a) 150,000 5,006,250
Alumax, Inc. (a) 182,300 5,924,750
Aluminum Co. of America 30,000 2,190,000
America West Holding Corp. Class B (a) 503,100 7,452,169
Boise Cascade Corp. 90,000 3,116,250
Boise Cascade Office Products Corp. (a) 125,000 2,375,000
Callaway Golf Co. 150,000 4,837,500
CapMAC Holdings, Inc. 150,000 4,500,000
Chesapeake Corp. 135,000 4,277,813
Circus Circus Enterprises, Inc. (a) 155,000 3,448,750
Cummins Engine Co., Inc. 38,500 2,346,094
Data General Corp. (a) 225,300 4,337,025
Dayton Hudson Corp. 122,700 7,707,094
Dillards, Inc. Class A 125,000 4,796,875
Donnkenny, Inc. (a) 59,000 213,875
Federated Department Stores, Inc. (a) 140,000 6,160,000
Furniture Brands International, Inc. (a) 350,000 5,862,500
Gibson Greetings, Inc. (a) 248,900 6,129,163
HFS, Inc. (a) 100,000 7,050,000
ITT Corp. (a) 120,000 8,962,500
Integrated Device Technology, Inc. (a) 300,000 3,468,750
International Business Machines Corp. 46,400 4,550,100
Louisiana-Pacific Corp. 200,000 4,200,000
MGM Grand, Inc. (a) 75,800 3,325,725
Maxim Group, Inc. (a) 255,000 3,601,875
Meyer (Fred), Inc. (a) 260,000 7,426,250
Micron Technology, Inc. (a) 70,000 1,876,875
Mirage Resorts, Inc. (a) 250,000 6,250,000
Modine Manufacturing Co. 139,200 4,741,500
Philip Morris Companies, Inc. 339,000 13,432,875
Premark International, Inc. 100,000 2,706,250
Providian Financial Corp. 150,000 5,550,000
RJR Nabisco Holdings Corp. 143,840 4,557,930
Ryder Systems, Inc. 150,000 5,250,000
Sears, Roebuck & Co. 65,500 2,742,813
Shopko Stores, Inc. (a) 230,000 5,764,375
Texas Instruments, Inc. 50,000 5,334,375
Thomas & Betts Corp. 82,628 4,110,743
Toys "R" Us, Inc. (a) 238,600 8,127,313
U.S. Office Products Co. (a) 110,500 3,453,125
204,590,732
TOTAL COMMON STOCKS
(Cost $939,387,691) 1,041,150,373
PREFERRED STOCKS - 3.2%
SHARES VALUE (NOTE 1)
CONVERTIBLE PREFERRED STOCKS - 1.0%
NETHERLANDS - 0.7%
Ballast Nedam NV CVA 100,000 $ 5,089,974
Samas-Groep NV 59,306 2,881,448
7,971,422
UNITED STATES OF AMERICA - 0.3%
Unisys Corp. $3.75, Series A 84,200 3,725,850
TOTAL CONVERTIBLE PREFERRED STOCKS 11,697,272
NONCONVERTIBLE PREFERRED STOCKS - 2.2%
AUSTRALIA - 0.3%
Sydney Harbour Casino Holdings Ltd. (a) 3,435,500 3,492,263
ITALY - 1.9%
Telecom Italia Spa 3,023,250 12,173,774
Telecom Italia Mobile Spa de Risp 4,400,000 8,991,310
21,165,084
TOTAL NONCONVERTIBLE PREFERRED STOCKS 24,657,347
TOTAL PREFERRED STOCKS
(Cost $33,299,922) 36,354,619
CASH EQUIVALENTS - 5.5%
Taxable Central Cash Fund (b)
(Cost $62,422,966) 62,422,966 62,422,966
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,035,110,579) $ 1,139,927,958
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$28,250,330 or 2.4% of net assets.
(d) Affiliated company (see Note 7 of Notes to Financial Statements).
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $944,789,458 and $830,897,132, respectively (see Note 3 of
Notes to Financial Statements).
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of Fidelity Management & Research Company.
The commissions paid to these affiliated firms were $214,053 for the
period (see Note 4 of Notes to Financial Statements).
Transactions during the period with companies which are or were
affiliates are as follows:
PURCHASES SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
BERU AG $ - $ - $ - $ 5,078,261
Haci Omer Sabanci Holding AS - 2,728 - 16,109,765
TOTALS $ - $ 2,728 $ - $ 21,188,026
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $1,035,575,504. Net unrealized appreciation
aggregated $104,352,454, of which $180,212,653 related to appreciated
investment securities and $75,860,199 related to depreciated
investment securities.
The fund hereby designates approximately $60,674,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.6%
Basic Industries 18.6
Cash Equivalents 5.5
Construction & Real Estate 6.0
Durables 7.7
Energy 0.7
Finance 14.6
Health 1.1
Holding Companies 3.3
Industrial Machinery & Equipment 8.3
Media & Leisure 5.5
Nondurables 6.9
Retail & Wholesale 6.2
Services 1.6
Technology 5.4
Transportation 1.5
Utilities 6.5
100.0%
WORLDWIDE
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

<TABLE>
<CAPTION>
<S> <C> <C>
OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE (COST $1,035,110,579) - SEE ACCOMPANYING SCHEDULE $ 1,139,927,958

RECEIVABLE FOR INVESTMENTS SOLD 10,054,504

RECEIVABLE FOR FUND SHARES SOLD 23,051,855

DIVIDENDS RECEIVABLE 2,348,179

INTEREST RECEIVABLE 505,943

OTHER RECEIVABLES 67,006

TOTAL ASSETS 1,175,955,445

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 8,149,662

PAYABLE FOR FUND SHARES REDEEMED 5,338,101

ACCRUED MANAGEMENT FEE 770,392

OTHER PAYABLES AND 505,909
ACCRUED EXPENSES

TOTAL LIABILITIES 14,764,064

NET ASSETS $ 1,161,191,381

NET ASSETS CONSIST OF:

PAID IN CAPITAL $ 913,417,419

UNDISTRIBUTED NET INVESTMENT INCOME 12,155,595

ACCUMULATED UNDISTRIBUTED 130,811,176
NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 104,807,191
AND ASSETS AND LIABILITIES IN FOREIGN CURRENCIES

NET ASSETS, FOR 67,254,704 $ 1,161,191,381
SHARES OUTSTANDING

NET ASSET VALUE, OFFERING PRICE $17.27
AND REDEMPTION PRICE PER SHARE ($1,161,191,381 (DIVIDED BY) 67,254,704 SHARES)

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 18,859,376
DIVIDENDS

SPECIAL DIVIDEND FROM GENCOR LTD. 3,692,000

INTEREST 4,847,972

27,399,348

LESS FOREIGN TAXES WITHHELD (1,824,472)

TOTAL INCOME 25,574,876

EXPENSES

MANAGEMENT FEE $ 7,971,278

TRANSFER AGENT FEES 3,070,459

ACCOUNTING FEES AND EXPENSES 590,839

NON-INTERESTED TRUSTEES' COMPENSATION 8,364

CUSTODIAN FEES AND EXPENSES 548,549

REGISTRATION FEES 130,339

AUDIT 63,017

LEGAL 10,213

REPORTS TO SHAREHOLDERS 158,292

MISCELLANEOUS 76,917

TOTAL EXPENSES BEFORE REDUCTIONS 12,628,267

EXPENSE REDUCTIONS (256,793) 12,371,474

NET INVESTMENT INCOME 13,203,402

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (INCLUDING 131,991,661
REALIZED GAIN OF $2,827 ON SALES
OF INVESTMENTS IN AFFILIATED ISSUERS)

FOREIGN CURRENCY TRANSACTIONS (169,364) 131,822,297

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 21,783,066

ASSETS AND LIABILITIES IN (4,942) 21,778,124
FOREIGN CURRENCIES

NET GAIN (LOSS) 153,600,421

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 166,803,823

OTHER INFORMATION $ 189,906
EXPENSE REDUCTIONS
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 5,763

TRANSFER AGENT CREDITS 61,124

$ 256,793

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 13,203,402 $ 13,034,296
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 131,822,297 28,773,100

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 21,778,124 64,176,063

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 166,803,823 105,983,459

DISTRIBUTIONS TO SHAREHOLDERS (9,779,572) (7,253,442)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (21,857,664) -

TOTAL DISTRIBUTIONS (31,637,236) (7,253,442)

SHARE TRANSACTIONS 1,506,418,739 826,965,537
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 31,099,635 7,084,969

COST OF SHARES REDEEMED (1,388,711,635) (714,607,691)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 148,806,739 119,442,815

TOTAL INCREASE (DECREASE) IN NET ASSETS 283,973,326 218,172,832

NET ASSETS

BEGINNING OF PERIOD 877,218,055 659,045,223

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $12,155,595 AND
$10,438,333, RESPECTIVELY) $ 1,161,191,381 $ 877,218,055

OTHER INFORMATION
SHARES

SOLD 90,093,952 57,492,786

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 2,080,227 532,304

REDEEMED (82,695,485) (49,735,743)

NET INCREASE (DECREASE) 9,478,694 8,289,347

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 E 1993

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 15.18 $ 13.32 $ 13.96 $ 12.76 $ 9.63

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .21 D, .22 .17 .08 .11
H

NET REALIZED AND UNREALIZED GAIN (LOSS) 2.43 1.79 (.08) 1.37 3.28

TOTAL FROM INVESTMENT OPERATIONS 2.64 2.01 .09 1.45 3.39

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.17) (.15) (.16) (.10) (.24)

FROM NET REALIZED GAIN (.38) - (.57) (.15) (.02) B

TOTAL DISTRIBUTIONS (.55) (.15) (.73) (.25) (.26)

NET ASSET VALUE, END OF PERIOD $ 17.27 $ 15.18 $ 13.32 $ 13.96 $ 12.76

TOTAL RETURN A 17.95% 15.25% .95% 11.55% 36.10%
C

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 1,161,191 $ 877,218 $ 659,045 $ 748,738 $ 287,278

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.18% 1.19% 1.17% 1.32% 1.40%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.16% 1.18% 1.16% 1.32% 1.40%

F F F

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.24% 1.71% 2.05% 1.40% 1.99%

PORTFOLIO TURNOVER RATE 85% 49% 70% 69% 57%

AVERAGE COMMISSION RATE G $ .0054 $ .0003

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 6 OF NOTES TO
FINANCIAL STATEMENTS). B INCLUDES AMOUNTS DISTRIBUTED FROM NET
REALIZED GAINS ON FOREIGN CURRENCY RELATED TRANSACTIONS
TAXABLE AS ORDINARY INCOME. C TOTAL RETURNS DO NOT INCLUDE THE ONE
TIME SALES CHARGE. D NET INVESTMENT INCOME PER SHARE HAS BEEN
CALCULATED BASED ON AVERAGE SHARES OUTSTANDING DURING THE PERIOD.
E EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED
STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE, AND
FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN, AND
RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES." AS A
RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS
RELATED TO BOOK TO TAX DIFFERENCES. F FMR OR THE FUND HAS ENTERED
INTO VARYING ARRANGEMENTS WITH THIRD PARTIES WHO EITHER PAID
OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 6 OF NOTES
TO FINANCIAL STATEMENTS). G FOR FISCAL YEARS BEGINNING ON
OR AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS
AVERAGE COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH
COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO
PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED
IN VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE
STRUCTURES MAY DIFFER. H INVESTMENT INCOME PER SHARE REFLECTS A
SPECIAL DIVIDEND FROM GENCOR LTD. WHICH AMOUNTED TO $.06 PER SHARE.

</TABLE>

NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED OCTOBER 31, 1997

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity International Growth & Income Fund, Fidelity Diversified
International Fund, Fidelity International Value Fund, Fidelity
Overseas Fund and Fidelity Worldwide Fund (the funds) are funds of
Fidelity Investment Trust (the trust). The trust is registered under
the Investment Company Act of 1940, as amended (the 1940 Act), as an
open-end management investment company organized as a Massachusetts
business trust. Each fund is authorized to issue an unlimited number
of shares. The financial statements have been prepared in conformity
with generally accepted accounting principles which permit management
to make certain estimates and assumptions at the date of the financial
statements. The following summarizes the significant accounting
policies of the funds:
SECURITY VALUATION. Securities for which quotations are readily
available are valued at the last sale price, or if no sale price, at
the closing bid price in the principal market in which such securities
are normally traded. If events which are expected to materially affect
the value of securities occur after the close of a principal market in
which those securities are traded, then those securities are valued at
their fair value, as determined in good faith under consistently
applied procedures under the general supervision of the Board of
Trustees ("fair value"). Securities (including restricted securities)
for which quotations are not readily available are valued primarily
using dealer-supplied valuations or at their fair value. Short-term
securities with remaining maturities of sixty days or less for which
quotations are not readily available are valued at amortized cost or
original cost plus accrued interest, both of which approximate current
value. Equity securities that have reached the limit for aggregate
foreign ownership may trade at a premium to the local share price. If
the broker-quoted premium is not readily available as a result of
limited share activity, the securities are valued at the last sale
price of the local shares in the principal market in which securities
are normally traded.
FOREIGN CURRENCY TRANSLATION. The accounting records of the funds are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Income
receipts and expense payments are translated into U.S. dollars at the
prevailing exchange rate on the respective dates of the transactions.
Purchases and sales of securities are translated into U.S. dollars at
the contractual currency exchange rates established at the time of
each trade.
Net realized gains and losses on foreign currency transactions
represent net gains and losses from sales and maturities of foreign
currency contracts, disposition of foreign currencies, and the
difference between the amount of net investment income accrued and the
U.S. dollar amount actually received. The effects of changes in
foreign currency exchange rates on investments in securities are
included with the net realized and unrealized gain or loss on
investment securities.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
U.S. federal income taxes to the extent that it distributes
substantially all of its taxable income for its fiscal year. Each fund
may be subject to foreign taxes on income and gains on investments
which are accrued based upon each fund's understanding of the tax
rules and regulations that exist in the markets in which they invest.
Each fund accrues such taxes as applicable. The schedules of
investments include information regarding income taxes under the
caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend
date, except certain dividends from foreign securities where the
ex-dividend date may have passed, are recorded as soon as the funds
are informed of the ex-dividend date. Non-cash dividends included in
dividend income, if any, are recorded at the fair market value of the
securities received. Interest income, which includes accretion of
original issue discount, is accrued as earned. Investment income is
recorded net of foreign taxes withheld where recovery of such taxes is
uncertain.
EXPENSES. Most expenses of the trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
between the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date. Certain foreign currency gains (losses) are taxable
as ordinary income and, therefore, increase (decrease) taxable
ordinary income available for distribution.
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for futures transactions, foreign currency transactions,
passive foreign investment companies (PFIC), market discount, and
losses deferred due to wash sales. Certain funds also utilized
earnings and profits distributed to shareholders on redemption of
shares as a part of the dividends paid deduction for income tax
purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income and accumulated undistributed net
realized gain (loss) on investments and foreign currency transactions
may include temporary book and tax basis differences which will
reverse in a subsequent period. Any taxable income or gain remaining
at fiscal year end is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. Certain funds use foreign currency
contracts to facilitate transactions in foreign-denominated
securities. Losses may arise from changes in the value of the foreign
currency or if the counterparties do not perform under the contracts'
terms. The U.S. dollar value of foreign currency contracts is
determined using contractual currency exchange rates established at
the time of each trade. The cost of the foreign currency contracts is
included in the cost basis of the associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), the funds, along with
other affiliated entities of Fidelity Management & Research Company
(FMR), may transfer uninvested cash balances into one or more joint
trading accounts. These balances are invested in one or more
repurchase agreements for U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the funds, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR, the funds' investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the SEC, the funds may invest in the Taxable Central Cash Fund (the
Cash Fund) managed by FMR Texas, Inc., an affiliate of FMR. The Cash
Fund is an open-end money market fund available only to investment
companies and other accounts managed by FMR and its affiliates. The
Cash Fund seeks preservation of capital, liquidity, and current income
by investing in U.S. Treasury securities and repurchase agreements for
these securities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
received by the funds are recorded as interest income in the
accompanying financial statements.
FUTURES CONTRACTS. Certain funds may use futures contracts to manage
their exposure to the stock and bond markets and to fluctuations in
interest rates and currency values. Buying futures tends to increase a
fund's exposure to the underlying instrument, while selling futures
tends to decrease a fund's exposure to the underlying instrument or
hedge other fund investments. Futures contracts involve, to varying
degrees, risk of loss in excess of the futures variation margin
reflected in each applicable fund's Statement of Assets and
Liabilities. The underlying face amount at value of any open futures
contracts at period end is shown in each applicable fund's schedule of
investments under the caption "Futures Contracts." This amount
reflects each contract's exposure to the underlying instrument at
period end. Losses may arise from changes in the value of the
underlying instruments or if the counterparties do not perform under
the contracts' terms. Gains (losses) are realized upon the expiration
or closing of the futures contracts. Futures contracts are valued at
the settlement price established each day by the board of trade or
exchange on which they are traded.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments. At the end of the period, the funds
had no investments in restricted securities (excluding 144A issues).
3. PURCHASES AND SALES OF INVESTMENTS.
Information regarding purchases and sales of securities (other than
short-term securities), the market value of future contracts opened
and closed, is included under the caption "Other Information" at the
end of each applicable fund's schedule of investments.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a
monthly basic fee that is calculated on the basis of a group fee rate
plus a fixed individual fund fee rate applied to the average net
assets of each fund. The group fee rate is the weighted average of a
series of rates and is based on the monthly average net assets of all
the mutual funds advised by FMR. The rates ranged from .2500% to
.5200% for the period. The annual individual fund fee rate is .45%. In
the event that these rates were lower than the contractual rates in
effect during the period, FMR voluntarily implemented the above rates,
as they resulted in the same or a lower management fee. The basic fee
for Diversified International, International Value and Overseas is
subject to a performance adjustment (up to a maximum of
(plus/minus).20% of the fund's average net assets over the performance
period) based on each fund's investment performance as compared to the
appropriate index over a specified period of time. For the period,
each fund's management fees was equivalent to the following annual
rates expressed as a percentage of average net assets after the
performance adjustment, if applicable:
International Value .85%
Overseas .84%
Diversified International .83%
International Growth & Income, Worldwide .75%
SUB-ADVISER FEE. FMR, on behalf of the funds, entered into
sub-advisory agreements with Fidelity Management & Research (U.K.)
Inc., Fidelity Management & Research (Far East) Inc., Fidelity
International Investment Advisors (FIIA), and Fidelity Investment
Japan Ltd. (International Value Fund only). In addition, FIIA entered
into sub-advisory agreement with its subsidiary, Fidelity
International Investment Advisors (U.K.) Limited
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SUB-ADVISER FEE - CONTINUED
FIIA (U.K.)L. Under the sub-advisory arrangements, FMR may receive
investment advice and research services and may grant the sub-advisers
investment management authority to buy and sell securities. FMR pays
its sub-advisers either a portion of its management fee or a fee based
on costs incurred for these services. FIIA pays FIIA(U.K.)L a fee
based on costs incurred for either service.
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an
affiliate of FMR, is the funds' transfer, dividend disbursing and
shareholder servicing agent. FSC receives account fees and asset-based
fees that vary according to account size and type of account. FSC pays
for typesetting, printing and mailing of all shareholder reports,
except proxy statements. For the period, each fund's transfer agent
fees were equivalent to the following annualized rates expressed as a
percentage of average net assets:
Overseas, Worldwide .29%
International Growth & Income .28%
Diversified International .27%
International Value .24%
ACCOUNTING FEES. FSC maintains each fund's accounting records. The fee
is based on the level of average net assets for the month plus
out-of-pocket expenses.
BROKERAGE COMMISSIONS. Certain funds placed a portion of their
portfolio transactions with brokerage firms which are affiliates of
FMR. The commissions paid to these affiliated firms are shown under
the caption "Other Information" at the end of each applicable fund's
schedule of investments
5. BANK BORROWINGS.
Each fund is permitted to have bank borrowings for temporary or
emergency purposes to fund shareholder redemptions. Each fund has
established borrowing arrangements with certain banks. Under the most
restrictive arrangement, each fund must pledge to the bank securities
having a market value in excess of 220% of the total bank borrowings.
The interest rate on the borrowings is the bank's base rate, as
revised from time to time. Information regarding a fund's
participation in the program is included under the caption "Other
Information" at the end of each applicable fund's schedule of
investments.
6. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a
portion of certain fund's expenses.
In addition, certain funds have entered into arrangements with their
custodian and transfer agent whereby credits realized as a result of
uninvested cash balances were used to reduce a portion of each
applicable fund's expenses. For the period, the reductions under these
arrangements are shown under the caption "Other Information" on each
applicable fund's Statement of Operations.
7. TRANSACTIONS WITH AFFILIATED COMPANIES.
An affiliated company is a company which the fund has ownership of at
least 5% of the voting securities. Information regarding transactions
with affiliated companies is included in "Other Information" at the
end of each applicable fund's schedule of investments.
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Investment Trust and the Shareholders of:
Fidelity International Growth & Income Fund,
Fidelity Diversified International Fund,
Fidelity International Value Fund,
Fidelity Overseas Fund,
and Fidelity Worldwide Fund:
We have audited the accompanying statements of assets and liabilities
of Fidelity Investment Trust: Fidelity International Growth & Income
Fund, Fidelity Diversified International Fund, Fidelity International
Value Fund, Fidelity Overseas Fund, and Fidelity Worldwide Fund,
including the schedules of portfolio investments, as of October 31,
1997, and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the two
years in the period then ended and the financial highlights for each
of the periods indicated therein. These financial statements and
financial highlights are the responsibility of the fund's management.
Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of October 31, 1997 by
correspondence with the custodian and brokers. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of Fidelity Investment Trust: Fidelity
International Growth & Income Fund, Fidelity Diversified International
Fund, Fidelity International Value Fund, Fidelity Overseas Fund, and
Fidelity Worldwide Fund as of October 31, 1997, the results of their
operations for the year then ended, the changes in their net assets
for each of the two years in the period then ended, and the financial
highlights for each of the periods indicated therein, in conformity
with generally accepted accounting principles.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
December 16, 1997
DISTRIBUTIONS

The Board of Trustees of the following funds voted to pay to
shareholders of record at the opening of business on record date, the
following distributions derived from capital gains realized from sales
of portfolio securities, and dividends derived from net investment
income:
PAY DATE RECORD DATE DIVIDENDS CAPITAL GAINS
International Growth &
Income 12/8/97 12/5/97 $.37 $.88
Diversified International 12/8/97 12/5/97 .19 .41
International Value 12/15/97 12/12/97 .06 .28
Overseas 12/8/97 12/5/97 .34 1.34
Worldwide 12/15/97 12/12/97 .11 1.16
A percentage of the dividends distributed during the fiscal year for
the following funds was derived from interest on U.S. Government
securities which is generally exempt from state income tax:
International Growth & Income 9.15%
International Value 1.64%
Overseas .87%
A percentage of the dividends distributed during the fiscal year for
the following funds qualifies for the dividends-received deduction for
corporate shareholders:
International Growth & Income 1%
Diversified International 11%
International Value 2%
Worldwide 11%
The amounts per share which represent income derived from sources
within, and taxes paid to, foreign countries or possessions of the
United States are as follows:
PAY DATE INCOME TAXES
International Growth &
Income 12/9/96 $.311 $.021
Diversified International 12/9/96 $.152 $.019
International Value 12/16/96 $.102 $.013
Overseas 12/9/96 $.484 $.059
Worldwide 12/16/96 $.180 $.025
The funds will notify shareholders in January 1998 of amounts for use
in preparing 1997 income tax returns.
PROXY VOTING RESULTS

WITHHELD 45,467,029.324 12.883

TOTAL 352,936,124.976 100.000

PHYLLIS BURKE DAVIS
AFFIRMATIVE 307,387,377.836 87.094

WITHHELD 45,548,747.140 12.906

TOTAL 352,936,124.976 100.000

ROBERT M. GATES
AFFIRMATIVE 307,219,404.498 87.047

WITHHELD 45,716,720.478 12.953

TOTAL 352,936,124.976 100.000

EDWARD C. JOHNSON 3D
AFFIRMATIVE 307,304,255.082 87.071

WITHHELD 45,631,869.894 12.929

TOTAL 352,936,124.976 100.000

E. BRADLEY JONES
AFFIRMATIVE 307,163,389.202 87.031

WITHHELD 45,772,735.774 12.969

TOTAL 352,936,124.976 100.000

DONALD J. KIRK
AFFIRMATIVE 307,589,965.173 87.152

WITHHELD 45,346,159.803 12.848

TOTAL 352,936,124.976 100.000

# OF % OF
SHARES VOTED SHARES VOTED
PETER S. LYNCH
AFFIRMATIVE 307,609,611.247 87.157

WITHHELD 45,326,513.729 12.843

TOTAL 352,936,124.976 100.000

WILLIAM O. MCCOY
AFFIRMATIVE 307,616,784.105 87.159

WITHHELD 45,319,340.871 12.841

TOTAL 352,936,124.976 100.000

GERALD C. MCDONOUGH
AFFIRMATIVE 307,384,278.082 87.093

WITHHELD 45,551,846.894 12.907

TOTAL 352,936,124.976 100.000

MARVIN L. MANN
AFFIRMATIVE 307,596,505.166 87.154

WITHHELD 45,339,619.810 12.846

TOTAL 352,936,124.976 100.000

ROBERT C. POZEN
AFFIRMATIVE 307,465,181.656 87.116

WITHHELD 45,470,943.320 12.884

TOTAL 352,936,124.976 100.000

THOMAS R. WILLIAMS
AFFIRMATIVE 307,326,062.668 87.077

WITHHELD 45,610,062.308 12.923

TOTAL 352,936,124.976 100.000

PROPOSAL 2
To ratify the selection of Coopers & Lybrand L.L.P. and Price
Waterhouse L.L.P. as independent accountants of the trust.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 297,481,581.663 84.288

AGAINST 4,739,203.560 1.342

ABSTAIN 50,715,339.753 14.370

TOTAL 352,936,124.976 100.000

PROPOSAL 3
To amend the Declaration of Trust to provide voting rights based on a
shareholder's total dollar investment in a fund, rather than on the
number of shares owned.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 274,619,710.990 79.850

AGAINST 15,944,801.447 4.637

ABSTAIN 53,353,237.539 15.513

TOTAL 343,917,749.976 100.000

BROKER NON-VOTES 9,018,375.000

INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,214,551.222 82.552

AGAINST 1,060,107.248 3.939

ABSTAIN 3,635,193.330 13.509

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 32,778,593.581 80.163

AGAINST 1,685,054.757 4.121

ABSTAIN 6,426,131.445 15.716

TOTAL 40,889,779.783 100.000

BROKER NON-VOTES 896,797.000

INTERNATIONAL VALUE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,312,453.267 92.686

AGAINST 482,581.886 3.632

ABSTAIN 489,071.856 3.682

TOTAL 13,284,107.009 100.000

BROKER NON-VOTES 22,149.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 40,435,397.481 74.208

AGAINST 3,264,172.190 5.990

ABSTAIN 10,789,868.614 19.802

TOTAL 54,489,438.285 100.000

BROKER NON-VOTES 558,880.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 25,242,154.211 75.752

AGAINST 1,392,235.403 4.178

ABSTAIN 6,687,722.312 20.070

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

PROPOSAL 4
To amend the Declaration of Trust to eliminate the requirement that
shareholders be notified in the event of an appointment of a trustee
within three months of the appointment.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 273,821,090.658 79.618

AGAINST 14,687,878.962 4.271

ABSTAIN 55,408,780.356 16.111

TOTAL 343,917,749.976 100.000

BROKER NON-VOTES 9,018,375.000

PROPOSAL 5
To amend the Declaration of Trust to clarify that the Trustees may
authorize the investment of all of a fund's assets in another open-end
investment company.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 253,910,627.527 73.810

AGAINST 33,659,944.597 9.785

ABSTAIN 56,433,204.852 16.405

TOTAL 344,003,776.976 100.000

BROKER NON-VOTES 8,932,348.000

PROPOSAL 6
To adopt a new fundamental investment policy for the fund that would
permit it to invest all of its assets in another open-end investment
company managed by FMR or an affiliate with substantially the same
investment objective and policies.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,752,380.457 77.118

AGAINST 2,318,514.058 8.616

ABSTAIN 3,838,957.285 14.266

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 29,799,517.825 72.878

AGAINST 4,196,649.474 10.263

ABSTAIN 6,893,612.484 16.859

TOTAL 40,889,779.783 100.000

BROKER NON-VOTES 896,797.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 38,988,856.503 71.553

AGAINST 4,447,794.766 8.163

ABSTAIN 11,052,787.016 20.284

TOTAL 54,489,438.285 100.000

BROKER NON-VOTES 558,880.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 23,477,579.914 70.456

AGAINST 2,933,011.188 8.802

ABSTAIN 6,911,520.824 20.742

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

PROPOSAL 7
To approve an amended management contract for the fund that would
reduce the management fee payable to FMR by the fund as FMR's assets
under management increase.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,329,275.609 81.967

AGAINST 989,737.718 3.633

ABSTAIN 3,922,933.473 14.400

TOTAL 27,241,946.800 100.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 26,013,556.656 75.704

AGAINST 1,217,311.390 3.543

ABSTAIN 7,131,324.880 20.753

TOTAL 34,362,192.926 100.000

PROPOSAL 8
To approve an amended management contract for the fund that would
reduce the management fee payable to FMR by the fund as FMR's assets
under management increase and would modify the performance adjustment
calculation to calculate the fund's investment performance and that of
its comparative index to the nearest 0.01%.
DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 32,637,591.763 78.105

AGAINST 1,798,094.297 4.303

ABSTAIN 7,350,890.723 17.592

TOTAL 41,786,576.783 100.000

INTERNATIONAL VALUE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,823,937.550 89.008

AGAINST 625,919.789 4.712

ABSTAIN 834,249.670 6.280

TOTAL 13,284,107.009 100.000

BROKER NON-VOTES 22,149.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 42,114,269.641 76.504

AGAINST 1,759,599.863 3.197

ABSTAIN 11,174,448.781 20.299

TOTAL 55,048,318.285 100.000

PROPOSAL 9
To approve a new sub-advisory agreement with Fidelity Investments
Japan Limited to provide investment advice and research services or
investment management services.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,189,525.132 81.454

AGAINST 1,000,981.624 3.674

ABSTAIN 4,051,440.044 14.872

TOTAL 27,241,946.800 100.000

DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 32,510,515.134 77.801

AGAINST 1,715,238.314 4.105

ABSTAIN 7,560,823.335 18.094

TOTAL 41,786,576.783 100.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 41,827,124.704 75.983

AGAINST 1,883,782.702 3.422

ABSTAIN 11,337,410.879 20.595

TOTAL 55,048,318.285 100.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 25,779,903.671 75.024

AGAINST 1,307,465.238 3.805

ABSTAIN 7,274,824.017 21.171

TOTAL 34,362,192.926 100.000

PROPOSAL 10
To approve a Distribution and Service Plan for the fund which
describes all material aspects of the proposed financing for the
distribution of fund shares.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,642,220.345 79.444

AGAINST 1,515,387.857 5.563

ABSTAIN 4,084,338.598 14.993

TOTAL 27,241,946.800 100.000

DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 31,263,388.207 74.817

AGAINST 2,954,275.148 7.070

ABSTAIN 7,568,913.428 18.113

TOTAL 41,786,576.783 100.000

INTERNATIONAL VALUE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,088,342.627 83.471

AGAINST 1,359,099.409 10.231

ABSTAIN 836,664.973 6.298

TOTAL 13,284,107.009 100.000

BROKER NON-VOTES 22,149.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,989,270.170 72.644

AGAINST 2,988,162.675 5.428

ABSTAIN 12,070,885.440 21.928

TOTAL 55,048,318.285 100.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 25,098,405.283 73.041

AGAINST 1,986,624.441 5.781

ABSTAIN 7,277,163.202 21.178

TOTAL 34,362,192.926 100.000

PROPOSAL 11
To replace the fund's fundamental investment policy regarding
investment in debt securities with a non-fundamental policy.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,053,487.966 78.237

AGAINST 1,821,480.550 6.769

ABSTAIN 4,034,883.284 14.994

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 38,595,298.256 70.831

AGAINST 4,451,818.628 8.170

ABSTAIN 11,442,320.401 20.999

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

PROPOSAL 12
Diversification: To amend the diversification limitation to exclude
"securities of other investment companies" from issuer diversification
limits.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,393,764.553 79.502

AGAINST 1,605,436.134 5.966

ABSTAIN 3,910,651.113 14.532

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

DIVERSIFIED INTERNATIONAL
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 30,650,296.365 74.958

AGAINST 3,086,900.195 7.550

ABSTAIN 7,152,583.223 17.492

TOTAL 40,889,779.783 100.000

BROKER NON-VOTES 896,797.000

INTERNATIONAL VALUE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,665,562.494 87.816

AGAINST 865,306.843 6.514

ABSTAIN 753,237.672 5.670

TOTAL 13,284,107.009 100.000

BROKER NON-VOTES 22,149.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 40,008,012.235 73.423

AGAINST 3,289,709.690 6.038

ABSTAIN 11,191,716.360 20.539

TOTAL 54,489,438.285 100.000

BROKER NON-VOTES 558,880.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 24,301,327.558 72.929

AGAINST 1,900,638.920 5.703

ABSTAIN 7,120,145.448 21.368

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

PROPOSAL 13
Real Estate: To make explicit the ability of the fund to purchase any
security or instrument backed by real estate or real estate interests
and any security of companies engaged in the real estate business.
Also to eliminate the restriction that securities backed by real
estate must be marketable.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,276,261.693 79.065

AGAINST 1,753,539.340 6.516

ABSTAIN 3,880,050.767 14.419

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,290,864.936 72.107

AGAINST 3,975,678.694 7.297

ABSTAIN 11,222,893.655 20.596

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 24,101,922.622 72.330

AGAINST 2,136,983.924 6.413

ABSTAIN 7,083,205.380 21.257

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

PROPOSAL 14
Borrowing: To amend the borrowing limitation to require a reduction in
borrowing if borrowings exceed the 33 1/3% limit for any reason rather
than solely because of a decline in net assets.
INTERNATIONAL GROWTH & INCOME
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,917,217.384 77.731

AGAINST 1,967,029.763 7.309

ABSTAIN 4,025,604.653 14.960

TOTAL 26,909,851.800 100.000

BROKER NON-VOTES 332,095.000

OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,475,079.298 72.445

AGAINST 3,682,502.458 6.759

ABSTAIN 11,331,855.529 20.796

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 23,786,528.359 71.384

AGAINST 2,359,019.344 7.079

ABSTAIN 7,176,564.223 21.537

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

PROPOSAL 15
To replace Overseas' fundamental investment policy concerning
investment for temporary defensive purposes with a non-fundamental
investment policy.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,469,545.337 72.435

AGAINST 3,436,053.138 6.306

ABSTAIN 11,583,838.810 21.259

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

PROPOSAL 16
Underwriting: To clarify Overseas' fundamental investment policy with
respect to the underwriting of securities.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,807,248.162 73.055

AGAINST 3,217,568.911 5.905

ABSTAIN 11,464,620.212 21.040

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

PROPOSAL 17
Concentration: To standardize the language of the limitation on
industry concentration and modify it to refer to "companies with
principal business activities in the same industry" rather than
"issuers in the same industry."
OVERSEAS
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 39,709,625.376 72.876

AGAINST 3,508,814.129 6.439

ABSTAIN 11,270,997.780 20.685

TOTAL 54,489,437.285 100.000

BROKER NON-VOTES 558,881.000

WORLDWIDE
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 24,194,960.638 72.609

AGAINST 2,061,199.031 6.186

ABSTAIN 7,065,952.257 21.205

TOTAL 33,322,111.926 100.000

BROKER NON-VOTES 1,040,081.000

INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc.,
London, England
Fidelity Management & Research (Far East) Inc.,
Tokyo, Japan
Fidelity Investments Japan Ltd.
Fidelity International Investment Advisors
Fidelity International Investment Advisors
(U.K.) Limited
OFFICERS
Edward C. Johnson 3d, PRESIDENT
Robert C. Pozen, SENIOR VICE PRESIDENT
William J. Hayes, VICE PRESIDENT
Robert Lawrence, VICE PRESIDENT, DIVERSIFIED INTERNATIONAL FUND
Richard Spillane Jr., VICE PRESIDENT, INTERNATIONAL GROWTH &
INCOME FUND, INTERNATIONAL VALUE FUND, OVERSEAS FUND,
WORLDWIDE FUND
Penelope A. Dobkin, VICE PRESIDENT, WORLDWIDE FUND
Gregory Fraser, VICE PRESIDENT, DIVERSIFIED INTERNATIONAL FUND
Richard Mace Jr., VICE PRESIDENT, INTERNATIONAL VALUE FUND,
OVERSEAS FUND
John R. Hickling, VICE PRESIDENT, INTERNATIONAL GROWTH &
INCOME FUND
Arthur S. Loring, SECRETARY
Richard A. Silver, TREASURER
Robert H. Morrison, MANAGER, SECURITY TRANSACTIONS
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
* INDEPENDENT TRUSTEES
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Chase Manhattan Bank, N.A.
New York, NY
FIDELITY'S INTERNATIONAL EQUITY FUNDS
Canada Fund
Diversified International Fund
Emerging Markets Fund
Europe Fund
Europe Capital Appreciation Fund
France Fund
Germany Fund
Global Balanced Fund
Hong Kong and China Fund
International Growth & Income Fund
International Value Fund
Japan Fund
Japan Small Companies Fund
Latin America Fund
Nordic Fund
Pacific Basin Fund
Southeast Asia Fund
Overseas Fund
United Kingdom Fund
Worldwide Fund
CORPORATE HEADQUARTERS
82 Devonshire Street
Boston, MA 02109
1-800-544-8888
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE

BULK RATE
U.S. POSTAGE
P A I D
F I D E L I T Y
INVESTMENTS

(registered trademark)
P.O. Box 193
Boston, MA 02101

(2_FIDELITY_LOGOS)FIDELITY'S
TARGETED INTERNATIONAL EQUITY
FUNDS
FIDELITY CANADA FUND
FIDELITY EMERGING MARKETS FUND
FIDELITY EUROPE FUND
FIDELITY EUROPE CAPITAL APPRECIATION FUND
FIDELITY FRANCE FUND
FIDELITY GERMANY FUND
FIDELITY HONG KONG AND CHINA FUND
FIDELITY JAPAN FUND
FIDELITY JAPAN SMALL COMPANIES FUND
FIDELITY LATIN AMERICA FUND
FIDELITY NORDIC FUND
FIDELITY PACIFIC BASIN FUND
FIDELITY SOUTHEAST ASIA FUND
FIDELITY UNITED KINGDOM FUND
ANNUAL REPORT
FOR THE YEAR ENDING
OCTOBER 31, 1997
AND
PROSPECTUS
DATED DECEMBER 30, 1997
CONTENTS

<TABLE>
<CAPTION>
<S> <C> <C>
MARKET RECAP A-4 A REVIEW OF WHAT HAPPENED IN WORLD MARKETS
DURING THE LAST SIX MONTHS.

FAIR-VALUE PRICING: HOW AND WHY A-5

CANADA FUND A-6 PERFORMANCE
A-7 FUND TALK: THE MANAGER'S OVERVIEW
A-9 INVESTMENT CHANGES
A-10 INVESTMENTS
A-12 FINANCIAL STATEMENTS

EMERGING MARKETS FUND A-14 PERFORMANCE
A-15 FUND TALK: THE MANAGER'S OVERVIEW
A-17 INVESTMENT CHANGES
A-18 INVESTMENTS
A-22 FINANCIAL STATEMENTS

EUROPE FUND A-24 PERFORMANCE
A-25 FUND TALK: THE MANAGER'S OVERVIEW
A-27 INVESTMENT CHANGES
A-28 INVESTMENTS
A-31 FINANCIAL STATEMENTS

EUROPE CAPITAL APPRECIATION FUND A-33 PERFORMANCE
A-34 FUND TALK: THE MANAGER'S OVERVIEW
A-36 INVESTMENT CHANGES
A-37 INVESTMENTS
A-39 FINANCIAL STATEMENTS

FRANCE FUND A-41 PERFORMANCE
A-42 FUND TALK: THE MANAGER'S OVERVIEW
A-44 INVESTMENT CHANGES
A-45 INVESTMENTS
A-47 FINANCIAL STATEMENTS

GERMANY FUND A-49 PERFORMANCE
A-50 FUND TALK: THE MANAGER'S OVERVIEW
A-52 INVESTMENT CHANGES
A-53 INVESTMENTS
A-55 FINANCIAL STATEMENTS

HONG KONG AND CHINA FUND A-57 PERFORMANCE
A-58 FUND TALK: THE MANAGER'S OVERVIEW
A-60 INVESTMENT CHANGES
A-61 INVESTMENTS
A-63 FINANCIAL STATEMENTS

JAPAN FUND A-65 PERFORMANCE
A-66 FUND TALK: THE MANAGER'S OVERVIEW
A-68 INVESTMENT CHANGES
A-69 INVESTMENTS
A-71 FINANCIAL STATEMENTS

JAPAN SMALL COMPANIES FUND A-73 PERFORMANCE
A-74 FUND TALK: THE MANAGER'S OVERVIEW
A-76 INVESTMENT CHANGES
A-77 INVESTMENTS
A-79 FINANCIAL STATEMENTS

LATIN AMERICA FUND A-81 PERFORMANCE
A-82 FUND TALK: THE MANAGER'S OVERVIEW
A-84 INVESTMENT CHANGES
A-85 INVESTMENTS
A-87 FINANCIAL STATEMENTS

NORDIC FUND A-89 PERFORMANCE
A-90 FUND TALK: THE MANAGER'S OVERVIEW
A-92 INVESTMENT CHANGES
A-93 INVESTMENTS
A-95 FINANCIAL STATEMENTS

PACIFIC BASIN FUND A-97 PERFORMANCE
A-98 FUND TALK: THE MANAGER'S OVERVIEW
A-100 INVESTMENT CHANGES
A-101 INVESTMENTS
A-104 FINANCIAL STATEMENTS

SOUTHEAST ASIA FUND A-106 PERFORMANCE
A-107 FUND TALK: THE MANAGER'S OVERVIEW
A-109 INVESTMENT CHANGES
A-110 INVESTMENTS
A-113 FINANCIAL STATEMENTS

UNITED KINGDOM FUND A-115 PERFORMANCE
A-116 FUND TALK: THE MANAGER'S OVERVIEW
A-118 INVESTMENT CHANGES
A-119 INVESTMENTS
A-122 FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS A-124 NOTES TO THE FINANCIAL STATEMENTS

REPORT OF INDEPENDENT ACCOUNTANTS A-128 THE AUDITORS' OPINION/ COOPERS & LYBRAND L.L.P.
A-129 THE AUDITORS' OPINION / PRICE WATERHOUSE LLP

DISTRIBUTIONS A-130

PROXY VOTING RESULTS A-131

FIDELITY'S TARGETED INTERNATIONAL EQUITY
FUNDS PROSPECTUS P-1

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To reduce expenses and demonstrate respect for our environment, we
have initiated a project through which we will begin eliminating
duplicate copies of most financial reports and prospectuses to most
households, even if they have more than one account in the fund.
If additional copies of financial reports, prospectuses or historical
account information are needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE
FUNDS. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE
INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR
MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL 1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE
YOU INVEST OR SEND MONEY.
MARKET RECAP

NOTE TO SHAREHOLDERS: RECENT VOLATILITY IN STOCK MARKETS AROUND THE
WORLD HAS DRAWN ATTENTION TO A PRACTICE EMPLOYED BY SOME MUTUAL FUND
COMPANIES CALLED "FAIR-VALUE" PRICING. FIDELITY HAS USED FAIR-VALUE
PRICING WHEN APPROPRIATE FOR MANY YEARS IN THE BELIEF THAT IT IS IN
THE BEST INTERESTS OF SHAREHOLDERS TO DO SO. THE FOLLOWING DISCUSSION
IS INTENDED TO HELP SHAREHOLDERS UNDERSTAND THE HOW AND WHY OF
FAIR-VALUE PRICING.
The daily net asset value of a mutual fund is calculated based on the
price of each security in the fund at the close of the New York Stock
Exchange at 4 p.m. Eastern Time. Generally, the calculation process is
fairly routine. However, when markets are volatile or major events
occur, the prices of some securities might be unavailable, unreliable
or out of date. It is at these times that Fidelity uses a special
procedure to determine the fair value of a security or, sometimes, of
an entire market.
Fair-value pricing can be particularly important in the case of
foreign securities, whose closing prices may not reflect their true
value when major changes occur after foreign markets close. An example
from last October 28, during a period of high market volatility,
illustrates how fair-value pricing of foreign securities can protect
fund shareholders.
Hong Kong ends its trading day 13 hours before the New York Stock
Exchange closes, and much can change during this time. The Hong Kong
market closed at 3 a.m. Eastern time on October 28, down 13.7%. But
after the market had closed, trading in certain securities listed on
the Hong Kong exchange continued in other markets around the world. In
this "after-hours" trading, the prices of these securities rebounded
significantly by the time Fidelity was required to price its funds at
the close of the U.S. market.
Rather than value Hong Kong securities at prices that were 13 hours
old - and far too low based on concrete evidence from later trading -
Fidelity took this later trading into account and priced Hong Kong
securities up about 10% on average. In fact, when the Hong Kong market
reopened for trading a few hours later, it was up about 14%.
This protected shareholders of Fidelity funds owning Hong Kong
securities by preventing aggressive traders from buying in at an
artificially low price - knowing that Hong Kong securities had gone up
- - then selling immediately at a profit the next day, rather like
betting on a horse race after it is run. The profit these in-and-out
traders sought would have been at the expense of investors who already
owned shares in the fund - and who took the investment risk over the
13-hour gap period.
Fair-value pricing also benefited any shareholders who wanted to sell
shares in funds owning Hong Kong securities that day because they
would have sold at what the shares were, in fact, worth.
Fidelity also uses fair-value pricing on individual securities. For
example, trading of a company's stock on the New York Stock Exchange
might be halted for some reason prior to the 4 p.m. market close. If
this occurs, and the value of that security changes materially, a
determination must be made of what the value of the security might
have been had it not halted trading. This is done by obtaining as much
information as possible - from Fidelity analysts and portfolio
managers, the bid/ask quotes of brokers and off-exchange institutional
trading - as to why the security halted trading and the implications
of the event. Based on this information, the fair value of the
security is determined.
Fair-value pricing is a practice that is disclosed in fund
prospectuses and governed by a detailed policy on fair-value pricing
based on guidelines promulgated by the Investment Company Institute,
the national trade association for the mutual fund industry. It also
is supported by the Securities and Exchange Commission, which said
recently, after an examination of the practice, that mutual funds
using fair-value pricing during difficult market conditions appear to
better protect long-term shareholders.
Fidelity uses fair-value pricing in the best interests of shareholders
so that the prices at which they buy and sell shares are timely and
fair, and so that long-term investors are protected against
speculators and aggressive traders who might try to take advantage of
pricing inefficiencies in the market.
CANADA
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the past five year and life of
fund total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

CANADA 8.21% 67.51% 189.16%

CANADA (INCL. 3% SALES CHARGE) 4.96% 62.48% 180.49%

TORONTO STOCK EXCHANGE 300 18.18% 102.44% 193.90%

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on November 17, 1987. For example, if you had
invested $1,000 in a fund that had a 5% return over the past year, the
value of your investment would be $1,050. You can compare the fund's
returns to the performance of the Toronto Stock Exchange 300 - a
market capitalization weighted index of 300 stocks traded in the
Canadian market. This index includes reinvested dividends and capital
gains.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

CANADA 8.21% 10.87% 11.25%

CANADA (INCL. 3% SALES CHARGE) 4.96% 10.19% 10.91%

TORONTO STOCK EXCHANGE 300 18.18% 15.15% 11.43%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19971031 19971126 104446 S00000000000001
Canada Toronto Stck Exchange 300
00309 DR001
1987/11/17 9700.00 10000.00
1987/11/30 9767.90 10286.60
1987/12/31 10446.90 11040.30
1988/01/31 10340.20 10895.74
1988/02/29 11048.30 11590.21
1988/03/31 11737.00 12272.51
1988/04/30 12008.60 12439.94
1988/05/31 11436.30 12098.46
1988/06/30 12319.00 13068.15
1988/07/31 12144.40 12938.90
1988/08/31 11562.40 12293.74
1988/09/30 11804.90 12566.48
1988/10/31 12357.80 12957.30
1988/11/30 12212.30 12977.22
1988/12/31 12480.81 13359.74
1989/01/31 13422.57 14393.21
1989/02/28 13045.87 14044.38
1989/03/31 13263.96 14206.77
1989/04/30 13531.62 14521.93
1989/05/31 13987.63 14583.58
1989/06/30 14661.73 15038.75
1989/07/31 15553.93 16096.62
1989/08/31 15633.23 16389.37
1989/09/30 15534.10 16125.85
1989/10/31 15316.01 16147.75
1989/11/30 15405.23 16404.85
1989/12/31 15849.10 16672.38
1990/01/31 14563.76 15218.73
1990/02/28 14646.68 15113.46
1990/03/31 14895.46 15268.51
1990/04/30 14180.23 14109.39
1990/05/31 15113.14 15070.71
1990/06/30 15465.57 15096.81
1990/07/31 15589.96 15355.54
1990/08/31 14688.15 14426.54
1990/09/30 14449.74 13689.01
1990/10/31 14066.21 13241.59
1990/11/30 14522.30 13611.23
1990/12/31 14978.60 14202.14
1991/01/31 15045.02 14257.74
1991/02/28 16428.85 15304.75
1991/03/31 17148.44 15406.86
1991/04/30 17281.29 15390.54
1991/05/31 18045.17 15912.70
1991/06/30 18067.31 15672.58
1991/07/31 18011.95 15902.07
1991/08/31 17856.97 15974.37
1991/09/30 17259.15 15583.24
1991/10/31 18023.03 16318.10
1991/11/30 17347.72 15889.70
1991/12/31 17627.42 15966.36
1992/01/31 17945.14 16106.32
1992/02/29 18051.04 15978.13
1992/03/31 17545.05 15196.78
1992/04/30 17333.24 14926.79
1992/05/31 17486.21 14968.69
1992/06/30 17392.07 15096.69
1992/07/31 17839.23 15545.70
1992/08/31 17568.58 15267.78
1992/09/30 16815.48 14245.94
1992/10/31 16744.87 14517.71
1992/11/30 16697.80 13789.53
1992/12/31 17121.47 14307.46
1993/01/31 17027.21 14169.09
1993/02/28 18087.72 15029.31
1993/03/31 19077.54 15643.94
1993/04/30 19572.45 16302.80
1993/05/31 19843.47 16771.89
1993/06/30 20856.85 17037.20
1993/07/31 20102.71 17021.15
1993/08/31 20609.40 17331.88
1993/09/30 19596.02 16587.33
1993/10/31 20998.26 17882.81
1993/11/30 20515.13 17399.99
1993/12/31 21482.47 18236.76
1994/01/31 22427.27 19129.68
1994/02/28 21470.66 18333.55
1994/03/31 20679.39 17554.10
1994/04/30 20525.86 17327.22
1994/05/31 20620.34 17610.59
1994/06/30 19486.57 16425.57
1994/07/31 19864.49 17030.35
1994/08/31 20608.53 17965.38
1994/09/30 20714.82 18391.75
1994/10/31 20289.65 18011.56
1994/11/30 18813.40 16932.36
1994/12/31 18907.95 17163.79
1995/01/31 17584.40 16318.78
1995/02/28 18305.26 16994.48
1995/03/31 19451.56 17710.56
1995/04/30 20042.43 18146.09
1995/05/31 20668.76 18708.95
1995/06/30 20952.38 19065.31
1995/07/31 21673.24 19571.24
1995/08/31 21401.44 19477.29
1995/09/30 21708.69 19623.33
1995/10/31 20739.66 19292.54
1995/11/30 21590.52 19966.92
1995/12/31 22574.56 20198.60
1996/01/31 22954.36 21167.27
1996/02/29 23156.13 21102.15
1996/03/31 23512.19 21494.09
1996/04/30 23963.21 22226.10
1996/05/31 24532.92 22589.16
1996/06/30 23737.70 21864.58
1996/07/31 23049.31 21209.04
1996/08/31 24034.42 22270.84
1996/09/30 24687.21 23072.87
1996/10/31 25921.57 24867.40
1996/11/30 26669.31 26546.06
1996/12/31 26176.87 25801.24
1997/01/31 28241.90 27089.05
1997/02/28 27543.66 26919.94
1997/03/31 25671.76 25332.56
1997/04/30 25850.03 25657.31
1997/05/31 28182.48 27824.99
1997/06/30 27692.22 28103.87
1997/07/31 28984.72 30071.59
1997/08/31 27885.35 28747.85
1997/09/30 29757.25 30816.24
1997/10/31 28048.77 29389.52
IMATRL PRASUN SHR__CHT 19971031 19971126 104451 R00000000000123
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Canada Fund on November 17, 1987, when the fund
started, and the current 3% sales charge was paid. As the chart shows,
by October 31, 1997, the value of the investment would have grown to
$28,049 - a 180.49% increase on the initial investment. For
comparison, look at how the Toronto Stock Exchange 300 did over the
same period. With dividends and capital gains, if any, reinvested, the
same $10,000 would have grown to $29,390 - a 193.90% increase.

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
CANADA
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Tom Sweeney, Portfolio Manager of
Fidelity Canada Fund
Q. TOM, HOW DID THE FUND PERFORM?
A. For the 12 months that ended on October 31, 1997, the fund had a
total return of 8.21%, underperforming the Toronto Stock Exchange 300
(TSE 300) return of 18.18%.
Q. WHY DID THE FUND UNDERPERFORM ITS INDEX?
A. There were two reasons. First, the fund was overweighted in natural
resource stocks, which generally performed poorly. Their performance
was negatively affected by fears of a possible worldwide recession,
which tends to depress the prices of natural resources, compounded by
the shake-up in the Pacific Rim markets late in the period. The fund
also was underweighted in financial stocks. I felt that their
valuations were historically high, so I limited my purchases to one of
the "Big Six" banks, National Bank of Canada. During the year, the Big
Six, which account for the majority of financial services market value
in the TSE 300, had their second terrific year in a row.
Q. HOW DID THE OVERWEIGHTING OF NATURAL RESOURCES STOCKS TIE IN TO
YOUR OVERALL INVESTMENT STRATEGY FOR THE FUND?
A. My belief was that natural resource stocks, with the possible
exception of gold, would perform well over the long term. Accordingly,
I built up positions in this sector, although I pared them back later
in the period as some stocks reacted to the general nervousness about
the possibility of a recession. In most cases, however, I felt that
the business prospects for these companies were sound.
Q. IN WHICH INDUSTRIES DID YOU FIND THE BEST OPPORTUNITIES?
A. Many energy companies performed well. The price of oil remained
fairly stable during the period, and shares of many companies in the
oil industry were selling at relatively cheap valuations. Rio Alto
Exploration, Canadian Occidental Petroleum, Beau Canada Exploration
and Penn West Petroleum all contributed positively to the fund's
performance. Telephone services also proved to be an attractive
industry, as the effects of long-distance service deregulation -
greater competition, better rates for consumers and company
cost-cutting measures - had a positive impact on share prices. Silver
mining companies such as Pan American Silver performed well, due to
rising silver prices and increasing demand. As I mentioned earlier,
financial stocks were historically expensive, but I did add National
Bank of Canada to the portfolio. This bank conducts its business
primarily in Quebec, whose economy is currently weaker than the rest
of Canada and, as a result, the stock has been undervalued and was
selling at a significant discount. However, I believed that long-term
prospects were positive for this bank.
Q. DID THE FISHING INDUSTRY RECOVER FROM ITS PREVIOUS WOES, AND WHAT
EFFECT DID IT HAVE ON THE FUND?
A. In 1992, after the Canadian government placed a virtual moratorium
on groundfish fishing, companies had to downsize dramatically. In the
process they reduced costs and eventually became profitable. Some
groundfish quotas have been increased from a lower base and a number
of companies are in a much stronger position due to their increased
efficiency and are increasing their profits. I purchased stocks such
as FPI Ltd. and National Sea Products well in advance of this
recovery, when they were quite inexpensive. Although there has not yet
been a significant impact on the fund's performance, I remain
optimistic about the long-term prospects for the fishing industry.
Q. WHICH STOCKS MADE POSITIVE CONTRIBUTIONS TO THE FUND'S PERFORMANCE?
A. Breakwater Resources, a zinc producer, made several positive
acquisitions during the year, sending the price of its stock up
sharply. I sold most of the fund's holdings at about the time its
share price peaked in September. Pan American Silver, a company I
mentioned earlier, owns a mine in Peru that has been quite profitable
at the current price of silver, helping its stock. Rio Alto is a
natural gas producer in Alberta that met its production goals
consistently, and benefited from a very cold winter in Alberta during
1996-97. Torstar, the publisher of the Toronto Star, performed well
early in the year, reflecting an improvement in the Canadian and
Ontario economies and a reduction in the cost of newsprint. Torstar
has since been sold from the fund's portfolio.
Q. WHICH STOCKS HURT THE FUND'S PERFORMANCE?
A. A number of gold mining shares, including Bresea Resources, War
Eagle Mining and Greenstone Resources, hurt the fund's performance
because that industry has performed poorly in line with falling gold
prices. However, the fund reduced its gold holdings significantly
earlier in the year, and has avoided full exposure to the
worst-performing major industry in Canada. Another holding,
Renaissance Energy, performed badly because its production did not
meet forecasts, and it fell out of favor with investors. I know this
company well. It's very reputable, with stable, long-term management
and very conservative production forecasts now in place. I remained
optimistic about the prospects for Renaissance, increasing the
weighting during the period in hopes of better performance. Noranda is
a conglomerate, with diversified holdings in oil, base metals and
paper and forest products. This type of company has not been as
popular as many other Canadian companies because of its focus on
natural resources. However, Noranda's underlying assets are worth more
separately than the company as a whole, and if management unbundles
less profitable parts of its business, its long-term prospects would
be favorable.
Q. HAVE YOU UNCOVERED ANY NEW INVESTMENT OPPORTUNITIES IN THE LAST SIX
MONTHS?
A. Yes. Deregulation in long-distance telephone service, which
occurred a few years ago, has opened up new opportunities. Next year
the local telephone service industry will be deregulated in Canada,
while a cap will remain on the prices consumers pay, resulting in
greater choice and predictable costs. I see good potential returns in
this area, and in anticipation of this change, I increased the fund's
holdings in telephone service companies, including BCE Inc. (Bell
Canada), Newtel Enterprises, and Maritime Telegraph and Telephone at
the end of the period.
Q. TOM, WHAT'S YOUR OUTLOOK?
A. I'm optimistic about the long-term prospects for this market. I
think Canada, with its concentration in natural resources companies,
which in many cases sell at discounts compared to their earnings
power, has a lot of upside potential. The Canadian government has done
a good job addressing the nation's economic problems and moving ahead
with deregulation. In the near term, there may be some continued
nervousness about the possibility of a recession, as investors react
to events in the U.S. and Pacific Rim markets. I believe that Canada
and its natural resources will be on the upswing within the next
couple of years.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

TOM SWEENEY ON CHANGES IN THE SILVER/GOLD PRICING
RELATIONSHIP:
"Historically, there has been a strong correlation between
the prices of silver and gold. However, over the past few
years this has begun to change with silver outperforming
gold. For example, in 1997 the price of gold has fallen more
than 15% while the price of silver is up about 10%. This
upswing in silver prices follows a long period of low prices
since this market collapsed in 1980, and has resulted in two
developments that are building the foundation for a silver
price recovery. First, there has been little increase in silver
supply over the last few years because the low price of this
precious metal has made mining uneconomical. Second,
silver consumption has grown steadily. In recent years, in
fact, silver consumption has exceeded production, with
the shortfall being made up from the drawdown of world
silver inventories. Inventories falling to critically low levels
has helped the price of silver recover. If the silver deficits
continue, I believe that the industry will approach shortage
levels and force the price of silver up further.
"I believe the fundamentals in the gold market are inferior
to those of silver. While the consumption of gold has grown
over the past few years, mine production has also grown;
that's because the price of gold never got low enough to
make production and development of gold mining
uneconomical. Adding to gold's woes, many of the world's
central banks have begun to sell some of their gold reserves
in increasing amounts, which is a big negative because their
holdings amount to approximately 15 years of world gold
production. This adds tremendous supply to the market
and puts downward pressure on gold's price.
"I believe that silver will continue to outperform gold in
the near term based on these factors, as long as the world
continues to experience low inflation. If inflation picks up,
there would be increased demand for both gold and silver
as an inflation hedge, with corresponding price increases.
Regardless, I am bullish on silver because I believe its price
will continue to recover as the market moves from surplus to
shortage, hopefully forcing the price of silver much higher in
the next couple of years. I believe that silver will continue to
outperform gold and I have positioned the fund accordingly,
building significant silver mining holdings."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of Canadian issuers
FUND NUMBER: 309
TRADING SYMBOL: FICDX
START DATE: November 17, 1987
SIZE: as of October 31, 1997, more than
$96 million
MANAGER: Tom Sweeney, since 1996; manager,
Fidelity Capital Appreciation Fund, 1986-1996;
Fidelity Select Paper and Forest Products Portfolio,
1986; joined Fidelity in 1985
(checkmark)
CANADA
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 26.4%
ROW: 1, COL: 1, VALUE: 26.4
ROW: 1, COL: 2, VALUE: 73.59999999999999
CANADA 73.6%
AS OF APRIL 30, 1997
UNITED STATES 22.9%
ROW: 1, COL: 1, VALUE: 22.9
ROW: 1, COL: 2, VALUE: 77.09999999999999
CANADA 77.1%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 94.3 90.6

SHORT-TERM INVESTMENTS 5.7 9.4

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

GENLYTE GROUP, INC. 7.4 4.2
(ELECTRICAL EQUIPMENT)

PAN AMERICAN SILVER CORP. 6.2 4.1
(PRECIOUS METALS)

FPI LTD. 5.2 5.7
(FOODS)

BCE, INC. 4.6 0.0
(TELEPHONE SERVICES)

HANCOCK FABRICS, INC. 4.2 2.9
(RETAIL & WHOLESALE, MISCELLANEOUS)

NATIONAL SEA PRODUCTS LTD. 3.7 2.9
(FOODS)

RENAISSANCE ENERGY LTD. 3.6 2.7
(OIL & GAS)

NORCEN ENERGY RESOURCES LTD. 3.3 3.2
(OIL & GAS)

OHIO EDISON CO. 3.1 1.3
(ELECTRIC UTILITY)

COMINCO LTD. 3.0 5.1
(METALS & MINING)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

ENERGY 23.5 27.9

BASIC INDUSTRIES 19.2 24.7

UTILITIES 11.3 4.2

PRECIOUS METALS 8.9 10.4

NONDURABLES 8.9 9.6

INDUSTRIAL MACHINERY & EQUIPMENT 7.4 4.2

FINANCE 5.3 1.5

RETAIL & WHOLESALE 4.2 2.9

MEDIA & LEISURE 1.9 2.6

TRANSPORTATION 1.8 0.6

CANADA
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 94.3%
SHARES VALUE (NOTE 1)
AEROSPACE & DEFENSE - 0.1%
Magellan Aerospace Corp. (a) 10,000 $ 75,260
BASIC INDUSTRIES - 19.2%
IRON & STEEL - 1.3%
Linamar Corp. 20,000 1,261,671
METALS & MINING - 8.3%
Anvil Range Mining Corp. 260,000 317,512
Alcan Aluminium Ltd. 70,000 1,988,001
Breakwater Resources Ltd. (a) 125,000 559,125
Cominco Ltd. 150,000 2,918,101
Noranda, Inc. 120,000 2,112,961
South Crofty Holdings Ltd. (a)(d) 2,000,000 241,400
8,137,100
PAPER & FOREST PRODUCTS - 9.6%
Avenor, Inc. 50,000 820,050
Cascades, Inc. 150,000 1,107,601
Crestbrook Forest Industries Ltd. (a) 100,000 699,350
Domtar, Inc. 150,000 1,166,176
Harmac Pacific, Inc. (a) 100,000 876,850
Paperboard Industries International, Inc. (a) 300,000 1,203,451
St. Laurent Paperboard, Inc. (a) 139,100 2,246,814
Tembec, Inc. Class A (a) 180,000 1,188,541
9,308,833
TOTAL BASIC INDUSTRIES 18,707,604
DURABLES - 0.4%
AUTOS, TIRES, & ACCESSORIES - 0.4%
Western Star Trucks Holdings Ltd. 15,000 378,075
ENERGY - 23.5%
OIL & GAS - 23.5%
Anderson Exploration Ltd. (a) 200,000 2,201,001
Beau Canada Exploration Ltd. (a) 600,000 1,469,701
Canadian Natural Resources Ltd. (a) 100,000 2,911,001
Canadian Occidental Petroleum Ltd. 100,000 2,570,201
Denbury Resources, Inc. (a) 40,000 826,440
Newport Petroleum Corp. (a) 325,000 1,672,938
Norcen Energy Resources Ltd. 140,000 3,170,862
Paramount Resources Ltd. 20,000 241,400
Penn West Petroleum Ltd. (a) 90,000 1,102,276
Petro-Canada 100,000 2,059,001
Renaissance Energy Ltd. (a) 150,000 3,482,552
Rio Alto Exploration Ltd. (a) 110,000 1,034,826
Ulster Petroleums Ltd. (a) 10,000 99,400
22,841,599
FINANCE - 5.3%
BANKS - 2.9%
National Bank of Canada 200,000 2,847,101
INSURANCE - 2.4%
Acceptance Insurance Co., Inc. (a) 100,000 2,325,000
TOTAL FINANCE 5,172,101
HOLDING COMPANIES - 0.3%
Queensway Financial Holdings Ltd. (a) 15,000 268,913
INDUSTRIAL MACHINERY & EQUIPMENT - 7.4%
ELECTRICAL EQUIPMENT - 7.4%
Genlyte Group, Inc. (a) 380,000 7,172,500

SHARES VALUE (NOTE 1)
MEDIA & LEISURE - 1.9%
BROADCASTING - 0.2%
Radiomutuel, Inc. Class A 20,000 $ 213,000
ENTERTAINMENT - 0.6%
Cinar Films, Inc. Class B (sub. vtg.) (a) 10,000 384,820
Coscient Group, Inc. (a):
Class A (multi-vtg.) 21,800 53,399
Class B (sub. vtg.) 42,100 91,168
529,387
PUBLISHING - 1.1%
Quebeco, Inc. Class B 50,000 1,065,001
TOTAL MEDIA & LEISURE 1,807,388
NONDURABLES - 8.9%
FOODS - 8.9%
FPI Ltd. (a)(d) 1,000,000 5,041,003
National Sea Products Ltd. (a)(d) 720,000 3,603,962
8,644,965
PRECIOUS METALS - 8.9%
Consolidated Nevada Goldfields
Corp. (a)(c) 1,000,000 482,800
Greenstone Resources Ltd. (a) 100,000 816,500
Greenstone Resources Ltd.
warrants 2/28/02 (a) 11,040 27,826
Pan American Silver Corp. (a) 750,000 6,017,253
Silver Standard Resources, Inc. (a) 275,000 1,171,501
United Keno Hill Mines Ltd. (a) 200,000 92,300
War Eagle Mining, Inc. (a) 300,000 102,240
8,710,420
RETAIL & WHOLESALE - 4.2%
RETAIL & WHOLESALE, MISCELLANEOUS - 4.2%
Hancock Fabrics, Inc. 300,000 4,068,750
TECHNOLOGY - 1.1%
ELECTRONIC INSTRUMENTS - 1.1%
Medar, Inc. (a) 190,000 1,116,250
TRANSPORTATION - 1.8%
AIR TRANSPORTATION - 1.8%
Transat AT, Inc. (a) 200,000 1,718,201
UTILITIES - 11.3%
ELECTRIC UTILITY - 5.9%
Boralex, Inc. Class A (a) 85,700 285,981
Ohio Edison Co. 120,000 2,970,000
Tucson Electric Power Co. (a) 150,000 2,484,375
5,740,356
TELEPHONE SERVICES - 5.4%
BCE, Inc. 160,000 4,458,802
Maritime Telegraph & Telephone
Co. Ltd. 20,000 437,360
Newtel Enterprises Ltd. 20,000 398,310
5,294,472
TOTAL UTILITIES 11,034,828
TOTAL COMMON STOCKS
(Cost $83,936,185) 91,716,854
CASH EQUIVALENTS - 5.7%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $5,525,135) 5,525,135 $ 5,525,135
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $89,461,320) $ 97,241,989
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to $482,800
or 0.5% of net assets.
(d) Affiliated Company (See Note 9 of Notes to Financial Statements).
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $164,952,305 and $205,153,266, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $2,560 for the period.
Transactions during the period with companies which are or were
affiliates are as follows:
PURCHASES SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
FPI Ltd. $ 2,283,156 $ - $ - $ 5,041,003
National Sea Products Ltd. 248,442 - - 3,603,962
South Crofty Holdings Ltd. 2,740 195,391 - 241,400
Totals $ 2,534,338 $ 195,391 $ - $ 8,886,365
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $89,811,000. Net unrealized appreciation
aggregated $7,430,989, of which $15,474,509 related to appreciated
investment securities and $8,043,520 related to depreciated investment
securities.
The fund hereby designates approximately $3,658,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
CANADA
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
97,241,989
(COST $89,461,320) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
2,799,007

RECEIVABLE FOR FUND SHARES SOLD 36,953

DIVIDENDS RECEIVABLE 18,105

INTEREST RECEIVABLE 17,339

TOTAL ASSETS
100,113,393

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 3,044,295

PAYABLE FOR FUND SHARES REDEEMED 503,217

ACCRUED MANAGEMENT FEE 30,389

OTHER PAYABLES AND ACCRUED EXPENSES 77,989

TOTAL LIABILITIES
3,655,890

NET ASSETS $
96,457,503

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
75,593,325

UNDISTRIBUTED NET INVESTMENT INCOME
322,747

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
12,763,656

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
7,777,775
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 5,110,300 $
96,457,503
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($96,457,503 (DIVIDED BY) 5,110,300 SHARES) $18.88

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $18.88) $19.46

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 1,090,577
DIVIDENDS

INTEREST 430,762

1,521,339

LESS FOREIGN TAXES WITHHELD (115,756)

TOTAL INCOME 1,405,583

EXPENSES

MANAGEMENT FEE $ 959,195
BASIC FEE

PERFORMANCE ADJUSTMENT (460,868)

TRANSFER AGENT FEES 427,702

ACCOUNTING FEES AND EXPENSES 96,809

NON-INTERESTED TRUSTEES' COMPENSATION 1,615

CUSTODIAN FEES AND EXPENSES 62,911

REGISTRATION FEES 23,499

AUDIT 47,083

LEGAL 2,626

REPORTS TO SHAREHOLDERS 19,334

MISCELLANEOUS 966

TOTAL EXPENSES BEFORE REDUCTIONS 1,180,872

EXPENSE REDUCTIONS (3,701) 1,177,171

NET INVESTMENT INCOME 228,412

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (INCLUDING REALIZED GAIN OF $75,527 13,790,680
ON SALES OF INVESTMENTS IN
AFFILIATED ISSUERS)

FOREIGN CURRENCY TRANSACTIONS (5,241) 13,785,439

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES (5,360,151)

ASSETS AND LIABILITIES IN (3,614) (5,363,765)
FOREIGN CURRENCIES

NET GAIN (LOSS) 8,421,674

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 8,650,086

OTHER INFORMATION $ 131,248
SALES CHARGES PAID TO FDC

DEFERRED SALES CHARGES WITHHELD $ 3,646
BY FDC

EXPENSE REDUCTIONS $ 2,907
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 67

TRANSFER AGENT CREDITS 727

$ 3,701

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 228,412 $ 588,385
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 13,785,439 44,553,089

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) (5,363,765) (9,158,534)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 8,650,086 35,982,940

DISTRIBUTIONS TO SHAREHOLDERS (783,295) (772,736)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (26,588,671) -

TOTAL DISTRIBUTIONS (27,371,966) (772,736)

SHARE TRANSACTIONS 53,914,016 38,234,017
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 27,052,083 759,773

COST OF SHARES REDEEMED (95,712,095) (271,428,450)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (14,745,996) (232,434,660)

REDEMPTION FEES 254,182 132,635

TOTAL INCREASE (DECREASE) IN NET ASSETS (33,213,694) (197,091,821)

NET ASSETS

BEGINNING OF PERIOD 129,671,197 326,763,018

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $322,747 AND $783,201,
RESPECTIVELY) $ 96,457,503 $ 129,671,197

OTHER INFORMATION
SHARES

SOLD 2,741,798 1,931,430

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,540,551 41,292

REDEEMED (5,109,443) (14,656,999)

NET INCREASE (DECREASE) (827,094) (12,684,277)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 D 1993

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.84 $ 17.55 $ 17.18 $ 17.82 $ 14.23

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME (LOSS) .03 C .08 C .05 - (.15)

NET REALIZED AND UNREALIZED GAIN (LOSS) 1.39 4.27 .33 (.60) 3.76

TOTAL FROM INVESTMENT OPERATIONS 1.42 4.35 .38 (.60) 3.61

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.13) (.08) (.01) - (.02)

FROM NET REALIZED GAIN (4.29) - - - -

IN EXCESS OF NET REALIZED GAIN - - - (.04) -

TOTAL DISTRIBUTIONS (4.42) (.08) (.01) (.04) (.02)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .04 .02 - - -

NET ASSET VALUE, END OF PERIOD $ 18.88 $ 21.84 $ 17.55 $ 17.18 $ 17.82

TOTAL RETURN A, B 8.21% 24.99% 2.22% (3.37)% 25.40%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 96,458 $ 129,671 $ 326,763 $ 368,330 $ 95,977

RATIO OF EXPENSES TO AVERAGE NET ASSETS .93% 1.01% 1.09% E 1.57% 2.00% E

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS .92% F .98% F 1.08% F 1.57% 2.00%

RATIO OF NET INVESTMENT INCOME (LOSS) TO AVERAGE NET ASSETS .18% .40% .26% (.14)% (.66)%

PORTFOLIO TURNOVER RATE 139% 139% 75% 59% 131%

AVERAGE COMMISSION RATE G $ .0242 $ .0276

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME
SALES CHARGE. C NET INVESTMENT INCOME (LOSS) PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING DURING
THE PERIOD. D EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED
STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE, AND FINANCIAL
STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN,
AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. E FMR AGREED
TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE BEEN
HIGHER. F FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH
THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES (SEE NOTE 7 OF NOTES TO FINANCIAL
STATEMENTS). G FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1,
1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER
SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS
AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND
TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS MARKETS
WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY DIFFER.

</TABLE>

EMERGING MARKETS
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

EMERGING MARKETS -36.74% -0.59% 12.68%

EMERGING MARKETS -38.63% -3.57% 9.30%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -8.48% 47.25% 157.68%
INTERNATIONAL EMERGING
MARKETS FREE INDEX

EMERGING MARKETS 3.17% 44.17% N/A
FUNDS AVERAGE

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on November 1, 1990. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. You can compare the fund's returns to
the performance of the Morgan Stanley Capital International (MSCI)
Emerging Markets Free Index - a market capitalization weighted index
of over 850 stocks traded in 22 world markets. Mexico, Malaysia,
Brazil, and Thailand are most heavily weighted, and together account
for over 60% of the index. Keep in mind that before February 1992, the
fund's objective was more broadly defined, and did not focus
specifically on emerging markets. However, to measure how the fund's
performance stacked up against its peers, you can compare it to the
emerging markets funds average, which reflects the performance of
mutual funds with similar objectives tracked by Lipper Analytical
Services, Inc. The past one year average represents a peer group of
117 mutual funds. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

EMERGING MARKETS -36.74% -0.12% 1.72%

EMERGING MARKETS -38.63% -0.72% 1.28%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -8.48% 8.05% 14.47%
INTERNATIONAL EMERGING
MARKETS FREE INDEX

EMERGING MARKETS 3.17% 7.29% N/A
FUNDS AVERAGE

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19971031 19971203 080754 S00000000000001
Emerging Markets MS EMF Index (Gross)
00322 MS006
1990/11/01 9700.00 10000.00
1990/11/30 9564.20 9571.06
1990/12/31 9777.33 9975.54
1991/01/31 9709.16 10782.17
1991/02/28 10118.17 12378.30
1991/03/31 10108.44 12889.03
1991/04/30 10332.42 13027.70
1991/05/31 10332.42 14052.74
1991/06/30 9972.10 13551.10
1991/07/31 10186.34 14255.08
1991/08/31 10108.44 14557.58
1991/09/30 10225.30 14002.85
1991/10/31 10127.91 14578.49
1991/11/30 9991.58 14362.80
1991/12/31 10438.08 15976.83
1992/01/31 10517.68 17826.43
1992/02/29 10826.15 18620.48
1992/03/31 10806.24 19252.13
1992/04/30 11064.96 19122.79
1992/05/31 11542.58 19054.82
1992/06/30 11522.68 17165.89
1992/07/31 11144.56 17354.93
1992/08/31 10865.95 16548.35
1992/09/30 10796.29 16609.34
1992/10/31 10995.30 17499.53
1992/11/30 10905.75 17309.63
1992/12/31 11048.91 17823.04
1993/01/31 11201.38 17909.23
1993/02/28 11770.60 18207.62
1993/03/31 12095.86 18807.85
1993/04/30 12482.12 19240.41
1993/05/31 12756.56 19769.94
1993/06/30 12919.19 20356.62
1993/07/31 13142.82 20904.76
1993/08/31 14057.63 22673.81
1993/09/30 14372.73 23280.87
1993/10/31 16446.31 25369.70
1993/11/30 17096.84 26492.37
1993/12/31 20082.32 30871.45
1994/01/31 19501.26 31433.12
1994/02/28 18950.78 30873.94
1994/03/31 17115.84 28080.18
1994/04/30 16952.74 27518.51
1994/05/31 17391.08 28460.32
1994/06/30 16167.79 27675.84
1994/07/31 17401.28 29396.67
1994/08/31 19613.39 33045.18
1994/09/30 20112.90 33420.73
1994/10/31 19623.58 32817.87
1994/11/30 18267.77 31111.53
1994/12/31 16480.81 28612.77
1995/01/31 14212.53 25568.64
1995/02/28 14376.01 24912.84
1995/03/31 14089.92 25071.12
1995/04/30 14386.23 26195.85
1995/05/31 15837.11 27589.45
1995/06/30 16021.03 27671.05
1995/07/31 16828.21 28292.18
1995/08/31 16317.33 27625.75
1995/09/30 16245.81 27494.64
1995/10/31 15469.28 26442.14
1995/11/30 14968.62 25970.59
1995/12/31 15956.70 27122.44
1996/01/31 17548.21 29050.35
1996/02/29 17340.17 28588.47
1996/03/31 17464.99 28811.13
1996/04/30 18359.57 29963.08
1996/05/31 18349.17 29829.29
1996/06/30 18276.35 30015.55
1996/07/31 16840.87 27964.18
1996/08/31 17517.00 28679.97
1996/09/30 17901.88 28928.42
1996/10/31 17277.76 28156.91
1996/11/30 18182.73 28628.69
1996/12/31 17552.02 28758.18
1997/01/31 18565.85 30719.77
1997/02/28 19558.57 32035.35
1997/03/31 18470.81 31193.85
1997/04/30 17298.56 31248.96
1997/05/31 17023.98 32143.32
1997/06/30 17150.71 33863.53
1997/07/31 16855.01 34369.04
1997/08/31 13010.88 29995.61
1997/09/30 13422.75 30826.73
1997/10/31 10930.41 25768.45
IMATRL PRASUN SHR__CHT 19971031 19971203 080757 R00000000000087
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Fidelity Emerging Markets Fund on November 1, 1990, when
the fund started, and the current 3% sales charge was paid. As the
chart shows, by October 31, 1997, the value of the investment would
have grown to $10,930 - a 9.30% increase on the initial investment.
For comparison, look at how the Morgan Stanley Capital International
Emerging Markets Free Index did over the same period. With dividends
and capital gains, if any, reinvested, the same $10,000 would have
grown to $25,768 - a 157.68% increase.

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
EMERGING MARKETS
FUND TALK: THE MANAGERS' OVERVIEW

NOTE TO SHAREHOLDERS: David Stewart (right photo) became Portfolio
Manager of Fidelity Emerging Markets Fund on November 1, 1997, after
the period ended. The following is an interview with Richard
Hazlewood, who managed the fund during the period covered by this
report, with additional comments from David Stewart on his outlook and
investment approach.
Q. RICHARD, HOW DID THE FUND PERFORM?
R.H. For the 12-month period that ended on October 31, 1997, the fund
was down 36.74%. For the same period, the Morgan Stanley Capital
International Emerging Markets Free Index was down 8.48%. The emerging
markets funds average, as tracked by Lipper Analytical Services,
returned 3.17% for the same 12-month period.
Q. WHAT HURT THE FUND'S PERFORMANCE OVER THE PERIOD, ESPECIALLY
COMPARED TO THE INDEX?
R.H. There were two main factors that hurt the fund versus the index.
First, the fund was overweighted versus the index in Southeast Asia
during a period when these markets underperformed dramatically. Most
of the fund's losses were related to its holdings in Malaysia,
Thailand and the Philippines. For the past five years, the fund has
been run by selecting investments on a stock-by-stock basis. The
fund's overweighted position in Southeast Asia reflected the
attractiveness of stocks in these countries, especially Malaysia.
However, certain situations can arise where even when companies are
doing all the right things on a fundamental basis, other economic
conditions such as currency devaluations can cause stocks to perform
poorly. During the past six months, the fund was hurt by Thailand's
decision to devalue its currency, which led to a contagion effect
where many other countries in Southeast Asia also devalued their
currencies. As a result, even though the fund owned stocks of
companies whose earnings went up, their stock prices collapsed as the
currencies collapsed. YTL Corporation was a prime example of this
scenario. In addition, the devaluations led to higher interest rates,
which over time will result in a weaker economy in many of these
countries. The second factor that hurt the fund was the significant
redemptions from it during the year, which resulted in the fund
selling heavily in markets that were often illiquid. As a result, the
fund didn't receive as good prices as it could have in a more stable
situation.
Q. AT THE END OF THE PERIOD, THE FUND REMAINED INVESTED IN MALAYSIA.
WHY DID THE FUND CONTINUE TO HOLD INVESTMENTS THERE?
R.H. While the fund remained invested in Malaysia, its weighting there
fell from 28% of the fund's holdings six months ago to about 11% at
the end of the period. The overweighted position at the start of the
period reflected the strong fundamentals - or business prospects - and
quality management of the Malaysian companies in which the fund
invested. As I mentioned, the recent market decline in Malaysia was
brought about by the Thai currency devaluation, which led to the
devaluation of the Malaysian currency, the ringgit. As in many
emerging markets, when the currency is under pressure, very few people
want to buy equities. As a result, the valuations of most stocks
became much cheaper relative to their companies' earnings potential,
with overall price-to-earnings (P/E) ratios falling from around 10
times earnings to about four times earnings. In fact, even though many
of these companies produced increased profits, their share prices went
down, in some cases as much as 60%. The decline in the fund's
Malaysian weighting reflected the effects of this "P/E multiple
contraction" as well as the currency depreciation. The fund continued
to hold these Malaysian stocks because even though they suffered from
these share-price declines, they remained attractive on a fundamental
basis.
Q. WERE THERE ANY BRIGHT SPOTS FOR THE FUND?
R.H. Yes, there were. The fund was helped by its holdings in South
Africa, Mexico and Brazil. The fund had a combined investment of about
27% in the latter two countries at the end of the period. While all of
the Latin American countries were pretty hard hit in October as a
result of the volatility in Southeast Asia, many Latin American stocks
still turned in positive performance over the 12-month period. Mexican
companies, especially in the financial sector, started doing well
after the economy began picking up earlier this year. Banks such as
Grupo Financiero Bancomer did very well and saw increased loan growth.
Top 10 holding Grupo Carso - a well-managed holding company with
multi-industry exposure - was one of the fund's top contributors over
the period. A number of the fund's holdings in Brazil also were strong
performers. The fund's largest holding at the end of the period,
Brazilian telephone company Telebras, and another top 10 holding,
electric utility Centrais Electricas Brasileiras (Electrobras), did
especially well because there was a great deal of optimism about the
upcoming privatization of these state-controlled companies. Another
top 10 holding that turned in a strong performance was Petrobras,
Brazil's state-controlled oil company. I believed this stock was a
very good long-term holding because Brazil imports the majority of its
oil and wants to become less dependent on foreign oil sources and more
reliant on internal resources.
Q. LET'S TALK ABOUT SOUTH AFRICA. YOU ALSO MENTIONED THAT HOLDINGS IN
THIS COUNTRY DID WELL . . .
R.H. The fund increased its weighting in South Africa at the start of
1997, after the country's currency had devalued during the previous
year. During 1997, this market performed well relative to the index. A
top performer there was Nedcor, one of the country's largest and most
efficiently run banks. I should also note that some Russian companies
turned in strong performances over the period. Cellular operator
Vimpel Communications benefited from an extremely strong Russian
market that was up 139% in dollar terms over the past year. While the
fund invested in Vimpel Communications and other Russian stocks that
are traded on exchanges in the U.S., it did not invest directly in
companies traded exclusively in the Russian stock market because
Fidelity considered doing so too risky. This negatively affected the
performance of the fund relative to its peers because many other
emerging market funds had up to 10% invested directly in Russia, one
of the top-performing emerging markets during the period.
Q. TURNING TO YOU, DAVID, HOW DOES THE FUND LOOK GOING FORWARD?
D.S. We are seeing a fair number of stocks showing good value in Latin
America. The fund has taken good advantage of these buying
opportunities in October. I'm quite optimistic about Mexico, in part
because the overall earnings outlook there remains very favorable and
disposable income among consumers is beginning to increase. In Brazil
I remain confident that the privatization process will stay on track,
so I expect to keep the fund overweighted in companies that can
benefit from privatization, to take advantage of this process. In
Southeast Asia, I will be focusing on companies that are earning hard
currency in dollar terms - such as energy stocks - and companies that
generate strong cash flow and have solid balance sheets - such as
tobacco companies and companies in the beverage sector. In addition,
Turkey looks good going forward because it is showing signs that it's
tackling its inflation and budget deficit problems. As a result, I
expect to accumulate stocks there over time. Lastly, conditions have
improved in Mainland China as interest rates have fallen, so I expect
to take advantage of the opportunities there.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGERS ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGERS' VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

DAVID STEWART ON HIS INVESTMENT APPROACH FOR FIDELITY
EMERGING MARKETS FUND:
"I use a fundamental, bottom-up approach. That is, I pick
stocks for the fund one at a time, making my selections
based on an individual company's business prospects.
Using the extensive research capabilities that we have at
Fidelity, my stock selection will be based on a medium- to
long-term outlook, especially in view of the current volatility
in emerging markets. To that end, I'll also try to invest in
larger-capitalization stocks that often are easier to sell in
a down market.
"I'll also seek to restructure the fund in order to reflect a
broad and balanced asset allocation process. This means
staying closer to the country weightings reflected in the
Morgan Stanley Emerging Markets index. By doing so, I will
try to keep the fund's volatility in check. In addition, I plan
to significantly reduce the number of the fund's holdings
over time, to thereby enhance the focus of the fund. I also
should note that I attempt to keep my turnover rates on
holdings low. That's because after I do the research and buy
what I consider to be a strong stock, I want to hold onto it."
(solid bullet) While there was market volatility in Southeast Asian
markets in October, most of the damage in that region
occurred before that. Still, markets continued to tumble in
October itself, when Hong Kong - which was immune to
most of the earlier tumult in Southeast Asia - was hit very
hard in October. At that point, the fund was not invested in
the Hong Kong market. October's volatility also negatively
affected most other emerging markets, especially those in
Latin America. In essence, Asia caught a cold and Latin
America got the flu.

FUND FACTS
GOAL: long-term growth of capital by
investing mainly in equity securities of
emerging market issuers, which can be found in
regions such as Southeast Asia, Latin America
and Eastern Europe
FUND NUMBER: 322
TRADING SYMBOL: FEMKX
START DATE: November 1, 1990
SIZE: as of October 31, 1997, more than
$499 million
MANAGER: David Stewart, since November
1997; manager, Fidelity Emerging Markets Pilot
Fund, since 1995; analyst covering emerging
markets, since 1995; joined Fidelity in 1994
(checkmark)
EMERGING MARKETS
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 8.0%
ARGENTINA 4.1%
ROW: 1, COL: 1, VALUE: 8.0
ROW: 1, COL: 2, VALUE: 4.9
ROW: 1, COL: 3, VALUE: 10.4
ROW: 1, COL: 4, VALUE: 3.6
ROW: 1, COL: 5, VALUE: 23.7
ROW: 1, COL: 6, VALUE: 12.7
ROW: 1, COL: 7, VALUE: 11.1
ROW: 1, COL: 8, VALUE: 7.2
ROW: 1, COL: 9, VALUE: 14.1
ROW: 1, COL: 10, VALUE: 4.1
THAILAND 4.9%
BRAZIL 14.1%
SOUTH AFRICA 10.4%
PHILIPPINES 3.6%
INDIA 7.2%
MALAYSIA 11.1%
OTHER 23.9%
MEXICO 12.7%
AS OF APRIL 30, 1997
UNITED STATES 3.3%
BRAZIL 12.5%
THAILAND 7.3%
ROW: 1, COL: 1, VALUE: 3.3
ROW: 1, COL: 2, VALUE: 7.3
ROW: 1, COL: 3, VALUE: 9.1
ROW: 1, COL: 4, VALUE: 5.7
ROW: 1, COL: 5, VALUE: 19.8
ROW: 1, COL: 6, VALUE: 6.3
ROW: 1, COL: 7, VALUE: 28.0
ROW: 1, COL: 8, VALUE: 5.1
ROW: 1, COL: 9, VALUE: 2.9
ROW: 1, COL: 10, VALUE: 12.5
SOUTH AFRICA 9.1%
INDIA 2.9%
INDONESIA 5.1%
PHILIPPINES 5.7%
OTHER 19.8%
MALAYSIA 28.0%
MEXICO 6.3%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 90.5% 94.6%

BONDS 1.5% 2.1%

SHORT-TERM INVESTMENTS 8.0% 3.3%

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

TELEBRAS SPONSORED ADR 3.3 6.1
(BRAZIL, TELEPHONE SERVICES)

CENTRAIS ELECTRICAS BRASILEIRAS SA 2.4 1.8
(BRAZIL, ELECTRIC UTILITIES)

INDOCHINA GOLDFIELDS LTD. 2.3 2.3
(CANADA, PRECIOUS METALS)

INDUSTRIAL FINANCE CORP. 2.3 3.4
OF THAILAND (FOR. REG.)
(THAILAND, CREDIT & OTHER FINANCE)

INDUSTRIAL CREDIT AND INVESTMENTS 2.3 0.8
CORP. LTD
(INDIA, CREDIT & OTHER FINANCE)

GRUPO CARSO SA DE CV CLASS A-1 1.8 2.7
(MEXICO, TOBACCO)

PETROBRAS PN (PFD. REG.) 1.8 0.9
(BRAZIL, OIL & GAS)

YTL CORP. BHD 1.7 3.5
(MALAYSIA, CONSTRUCTION)

TELEFONOS DE MEXICO SA SPONSORED 1.7 0.0
ADR REPRESENTING ORD. CLASS L SHARES
(MEXICO, TELEPHONE SERVICES)

HONG LEONG CREDIT BHD 1.7 2.7
(MALAYSIA, CREDIT & OTHER FINANCE)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 31.1 38.4

UTILITIES 16.2 12.6

NONDURABLES 8.5 7.9

CONSTRUCTION & REAL ESTATE 8.3 11.7

ENERGY 6.3 4.0

BASIC INDUSTRIES 5.9 4.8

HOLDING COMPANIES 4.8 6.0

PRECIOUS METALS 4.1 4.9

RETAIL & WHOLESALE 2.3 0.8

MEDIA & LEISURE 1.8 3.3

EMERGING MARKETS
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 90.4%
SHARES VALUE (NOTE 1)
ARGENTINA - 4.1%
Banco de Galicia Y Buenos Aires SA
sponsored ADR representing
Class B shares 159,006 $ 3,853,411
Bansud SA Class B (a) 36,000 320,586
IRSA (Inversiones Y Representa) SA GDR 49,900 1,684,125
Perez Companc Class B 829,258 5,194,168
Telecom Argentina Class B
sponsored ADR 93,500 2,366,719
YPF Sociedad Anonima sponsored ADR
representing Class D shares 219,800 7,033,600
20,452,609
AUSTRALIA - 0.0%
Overseas & General Ltd. (a) 260,750 14,624
BANGLADESH - 0.0%
Beximco Pharmaceuticals Ltd. (a) 43,170 118,151
BRAZIL - 14.1%
Bradesco PN 534,036,354 3,971,628
Centrais Electricas Brasileiras SA 27,066,800 11,709,471
Compania Cervejaria Brahma PN
(Pfd. Reg.) warrants 4/30/03 (a) 697,000 94,821
Compania Cervejaria Brahma PN
(Pfd. Reg.) 8,380,648 5,244,556
Compania Energertica Minas Gerais 131,805,000 5,259,771
Itaubanco PN (Pfd. Reg.) 3,931,000 1,586,518
Klabin Industria de Papel e Celulose PN 1,413,887 1,089,973
Light Participacoes SA (a) 8,770,000 2,243,007
Petrobras PN (Pfd. Reg.) 47,760,000 8,879,740
Souza Cruz Industria Comerico 464,600 3,779,668
Telebras sponsored ADR 159,600 16,199,400
Telebras ON 44,735,000 3,975,680
Telesp ON (a) 1,896,269 404,157
Telesp PN (Pfd. Reg.) 15,402,635 4,023,181
Telesp PN rights 11/12/97 (a) 578,433 525
Votorantim Celulose e Papel SA
(Pfd. Reg.) 47,768,505 1,139,843
69,601,939
CANADA - 2.9%
Black Sea Energy Ltd. (a)(c) 729,300 1,501,629
First Dynasty Mines Ltd. (a) 1,178,900 770,058
Indochina Goldfields Ltd. (a) 2,918,800 11,397,920
Indochina Goldfields Ltd. (a)(c) 139,000 542,795
14,212,402
CHILE - 1.8%
Compania Cervecerias Unidas SA
sponsored ADR 58,500 1,425,938
Enersis SA sponsored ADR 50,000 1,650,000
Quinenco SA sponsored ADR 46,000 672,750
Soc Quimica y Minera de Chile ADR 98,000 5,083,750
Vina Concha Stet y Toro SA
sponsored ADR 10,700 291,575
9,124,013
CHINA (PEOPLES REPUBLIC) - 0.0%
Beijing Datang Power Class H (c) 58,000 29,263
Guangdong Electric Power
Development Co. Ltd. Class B 50,000 28,202
57,465
COLOMBIA - 1.6%
Banc Industrial Colombiano
sponsored ADR 12,700 203,200
Suramericana de Seguros SA 340,700 7,558,885
7,762,085

SHARES VALUE (NOTE 1)
CZECH REPUBLIC - 0.5%
CEZ AS 72,800 $ 2,306,369
GREECE - 0.3%
Alpha Credit Bank 10,000 659,520
Ergo Bank SA (Reg.) 10,000 595,199
1,254,719
HONG KONG - 0.3%
China Telecom (Hong Kong) Ltd. (a) 987,000 1,576,902
Magnum International Holdings Ltd.
warrants 2/16/98 (a) 250,000 3,881
1,580,783
INDIA - 7.2%
Bharat Petroleum Corp. Ltd. 144,600 1,734,404
Bajaj Auto Ltd. 28,150 448,193
Chemplast Sanmar Ltd. 210,000 167,538
Chemplast Sanmar Ltd. (c) 315,000 251,307
Colgate-Palmolive 49,050 387,610
Crompton Greaves Ltd. 221,700 260,734
Hindalco Industries Ltd. 25,000 652,682
Hindustan Petroleum Corp. Ltd. 20,000 262,724
ITC Ltd. 90,000 1,391,472
Industrial Credit & Investments Corp. Ltd. 4,655,860 11,303,429
Larsen and Toubro Ltd. 300 1,556
Mahindra & Mahindra Ltd. (a) 287,700 2,861,171
Mahindra & Mahindra Ltd. GDR 83,333 833,330
Mahanagar Telephone Nigam Ltd. 648,100 4,515,305
Oriental Bank of Commerce 450,000 733,494
Prime Securities (a) 289,100 66,012
Ranbaxy Laboratories Ltd. 20,250 394,415
Reliance Industries Ltd. 572 2,966
Reliance Industries Ltd. (New) 572 2,915
State Bank of India 1,090,000 7,886,382
TVS Suzuki 25,000 287,999
Tata Engineering & Locomotive Ltd. 83,130 728,388
Zee Telefilms Ltd. 88,300 301,216
35,475,242
INDONESIA - 3.0%
Gulf Indonesia Resources Ltd. 50,000 1,050,000
PT Apac Centertex Corp.
warrants 7/14/01 (a) 5,838,375 283,810
PT Astra International 2,011,000 1,494,286
PT Bank Bali (For. Reg.) 350,000 170,139
PT Bank Bali warrants 8/29/00
(For. Reg.) (a) 200,000 47,222
PT Bank Dagang Nasional Indonesia
warrants 2/14/00 (For. Reg.) (a) 3,100,000 93,861
PT Bank International Indonesia
(For. Reg.) 500,000 107,639
PT Bank International Indonesia
warrants 1/17/00 (For. Reg.) (a) 483,668 27,408
PT Bank PAN Indonesia (For. Reg.) 9,814,250 2,180,946
PT Bank PAN Indonesia
warrants 6/26/00 (For. Reg.) (a) 1,973,464 49,337
PT Bhuwanatala Indah Permai
warrants 11/28/01 (a) 1,260,000 45,500
PT Bank Niaga Tbk (For. Reg.) 2,758,139 440,537
PT Gudang Garam 15,000 42,500
PT Perdanacipta Multi Finance (a)(d) 11,714,000 976,167
PT Putra Surya Multidana (a) 643,500 223,438
Sampoerna Hanjaya Mandala 4,231,051 7,374,963
14,607,753
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
ISRAEL - 2.0%
Bank Hapoalim BM 866,000 $ 2,040,059
First International Bank of Israel 3,020 1,892,614
Gilat Satellite Networks Ltd. (a) 5,000 162,500
Koor Industries Ltd. sponsored ADR 148,200 3,167,775
Teva Pharmaceutical Industries Ltd. ADR 55,400 2,589,950
9,852,898
KOREA (SOUTH) - 1.7%
Housing & Commercial Bank
GDR (Reg.) (a) 80,000 660,000
Hyundai Fire & Marine Insurance Co. 7,100 205,275
Housing & Commercial Bank 127,490 1,400,408
Kookmin Bank 163,957 1,325,248
Lg Electronics, Inc. 45,000 606,217
Lg Insurance Co. Ltd. 26,700 827,285
Lg Semicon Co. Ltd. (a) 43,700 720,031
Samsung Electronics Co. Ltd. (vtg.) 9,129 358,538
Samsung Fire & Marine Insurance 8,195 2,165,517
8,268,519
LUXEMBOURG - 0.3%
Quilmes Industrial SA sponsored ADR 130,000 1,608,750
MALAYSIA - 9.8%
Arab Malaysian Corp. BHD 3,274,428 2,893,226
Arab Malaysian Finance BHD (For. Reg.) 7,074,332 3,695,547
HLG Capital BHD 41,333 61,444
Hong Leong Bank BHD 1,186,000 1,168,298
Hong Leong Bank BHD
warrants 2/28/99 (a) 4,080,675 852,678
Hong Leong Credit BHD 5,939,300 8,261,832
Hong Leong Credit BHD
warrants 12/27/01 (a) 1,252,200 246,702
Hume Industries BHD 1,281,000 2,485,522
Industrial Oxygen, Inc. BHD 2,791,000 2,366,102
Kamunting Corp. BHD 1,737,000 440,731
Malaysian Plantations BHD 11,672,000 5,226,269
Sungei Bagen Rubber Co. BHD 10,000 304,478
YTL Cement BHD 2,620,800 2,644,270
YTL Corp. BHD 7,769,800 8,581,570
YTL Corp. BHD Class A (a) 4,883,400 5,218,678
YTL Corp. BHD warrants 9/30/02 (a) 976,680 3
YTL Power International BHD (a) 5,025,680 4,005,542
48,452,892
MEXICO - 12.7%
Cifra SA de CV:
Series A 253,465 465,190
Series C 2,854,300 4,938,825
Corporacion Geo SA de CV
Class B sponsored ADR (a)(c) 12,700 269,875
Corporacion Geo SA de CV (a) 1,021,640 5,510,516
DESC (Sociedad de Fomento
Industrial SA) Class B 100,000 859,189
Fomento Economico Mexicano SA
de CV Class B 431,000 3,034,487
Gruma SA Class B
sponsored ADR (a)(c) 160,650 2,449,913
Grupo Carso SA de CV Class A-1 1,413,000 8,953,496
Grupo Financiero Bancomer Class B (a) 17,401,900 8,202,567
Grupo Elektra SA 4,250,000 5,781,623
Grupo Financiero Inbursa SA Class B 1,566,208 5,513,501
Grupo Modelo SA de CV Class C Ord. 159,300 1,178,592
Grupo Televisa SA de CV
sponsored ADR (a) 44,700 1,385,700

SHARES VALUE (NOTE 1)
Kimberly Clark de Mexico SA Class A 1,238,000 $ 5,436,563
Telefonos de Mexico SA sponsored ADR
representing Ord. Class L shares 197,000 8,520,250
62,500,287
PAKISTAN - 0.8%
Askari Leasing Ltd. 17,200 9,478
Dandot Cement Co. Ltd. (a) 93,750 7,456
DG Kahn Cement Ltd. (a) 212,850 49,578
First Grindlays Modarba 490 159
Hub Power Co. Ltd. GDR (a) 62,200 1,959,300
Maple Leaf Cement Factory Ltd. (a) 270,000 40,801
Pakistan State Oil Co. Ltd. 145,011 1,565,246
Pakland Cement Ltd. (a) 30,000 4,602
Sunflo Cit-Russ Ltd. (a) 100 17
Sui Southern Gas Pipelines Ltd. (a) 110,167 74,102
Trust Leasing Corp. Ltd. (a) 20,666 2,700
Union Bank Ltd. (a) 2,743 717
3,714,156
PERU - 0.2%
Compania de Minas Buenaventura SA
Class B sponsored ADR 50,000 896,875
PHILIPPINES - 3.5%
Centennial City, Inc. (a) 85,051,200 1,060,129
Empire East Land, Inc. (a) 114,586,000 2,759,151
Guoco Holdings Philippines, Inc. 105,122,000 3,275,759
Lepanto Consolidated Mining Co. (a) 250,268,000 3,403,069
Megaworld Properties &
Holdings, Inc. (a) 86,599,250 4,072,373
Mondragon International
Philippines, Inc. 78,440 4,266
PICOP Resources (a) 27,914,900 711,713
Robinson's Land Corp. (a) 51,999,000 2,180,126
United Paragon Mining Corp. (a) 45,000 523
17,467,109
POLAND - 0.3%
Bank Handlowy W Warszawie SA (a) 117,000 1,571,191
Bank Slaski SA 1,000 58,250
BRE (Bank Rozwoju Eksportu) 1,000 18,077
Wedel SA 1,000 48,207
1,695,725
RUSSIA - 1.8%
Mosenergo AO sponsored ADR 46,500 1,953,000
Tatneft AO sponsored ADR (c) 1,000 141,000
Tatneft AO sponsored ADR (Reg.) 19,900 2,805,900
Vimpel Communications sponsored ADR 118,900 3,893,975
8,793,875
SINGAPORE - 0.1%
Transmarco Ltd. 40,000 274,634
SOUTH AFRICA - 10.4%
Amalgamated Banks of South Africa Ltd. 874,756 5,177,683
Anglo American Corp. of
South Africa Ltd. (Reg.) 39,900 1,723,614
Barlow Rand Ltd. Ord. 218,000 2,195,846
Coronation Holdings Ltd.,
Shares N (1/100th vtg.) (a) 59,200 954,085
Energy Africa Ltd. (a) 138,718 727,441
First National Bank Holdings Ltd. 510,000 3,850,156
Johnnies Industrial Corp. Ltd. (Reg.) 379,500 4,256,075
Liberty Life Association of Africa Ltd. 73,606 1,834,417
Metropolitan Life Ltd. (a) 200,000 427,830
NBS Boland Group Ltd. (a) 2,107,330 4,201,530
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
SOUTH AFRICA - CONTINUED
Nedcor Ltd. 257,582 $ 5,403,070
Orion Selections Holdings Ltd. 414,700 1,033,520
Persetel Q Data Holdings Ltd. 488,000 3,065,836
Real Africa Holdings Ltd. 587,100 1,280,280
Rembrandt Group Ltd. 712,100 5,841,734
Sasol Ltd. 570,900 6,876,885
South African Breweries Ltd. 100,000 2,658,359
51,508,361
SRI LANKA - 0.5%
Aitken Spence & Co. Ltd. 95,000 246,340
Development Finance Corp. of Ceylon 200,288 847,727
John Keells Holdings Ltd. 112,979 576,472
National Development Bank 150,000 602,258
2,272,797
TAIWAN - 3.0%
Acer, Inc. (a) 732,500 1,006,742
Asustek Computer, Inc. 200,000 2,515,397
Cathay Life Insurance Co. Ltd. 1,516,000 6,781,459
Cathay Construction Co. Ltd. 1,580,000 1,690,114
China Trust Co. Ltd. 1,900,000 2,623,663
Taiwan Semiconductor
Manufacturing Co. Ltd. (a) 20,000 63,209
14,680,584
THAILAND - 4.9%
Ayudhya Insurance Co. 181,800 904,015
Bangkok Bank Ltd. (For. Reg.) 50,000 170,628
Bangkok Expressway PCL (For. Reg.) (a) 350,000 255,941
Bangkok Union Insurance Co. Ltd.
(For. Reg.) 50,000 14,321
Bumrungrad Hospital PCL (For. Reg.) 46,600 15,619
Charan Insurance PCL (For. Reg.) (d) 317,300 160,487
Deves Insurance Co., Ltd. 60,000 77,514
First City Investment Public Co. Ltd. FCI
(For. Reg.) 588,200 60,218
Industrial Finance Corp. of Thailand
(For. Reg.) 13,720,966 11,371,429
Kiatnakin Finance & Securities PCL
warrants 3/30/00 (a) 24,516 7,320
Krung Thai Bank Ltd. (For. Reg.) 2,479,210 846,044
Nithipat Capital PCL (a) 2,395,900 547,509
Nithipat Capital PCL (For. Reg.)
warrants 12/15/99 (a) 49,800 5,341
S Khon Kaen Food Industry PCL
(For. Reg.) 30,700 51,634
Safety Insurance PCL (For. Reg.) 363,200 75,252
Siam City Bank PCL (For. Reg.)
rights 11/30/97 (a) 1,000,275 -
Siam City Bank PCL (For. Reg.) 2,000,550 429,125
Securities One PCL (For. Reg.) 766,000 184,848
Siam Commercial Life Assurance
(For. Reg.) (a) 215,100 44,042
Thai Farmers Bank PCL 89,100 238,903
Thai Farmers Bank PCL
(For. Reg.) warrants 9/15/02 (a) 123,987 43,067
Thai Military Bank Ltd. (For. Reg.) 19,750,980 7,823,361
Thai Reinsurance Co. Ltd. (For. Reg.) 340,000 646,435
Tong Hua Daily News Co. Ltd.
(For. Reg.) (d) 639,200 63,881
24,036,934

SHARES VALUE (NOTE 1)
TURKEY - 1.6%
Akbank 57,359,505 $ 3,891,125
Anadolu Anonim Turk Sigoria SK (a) 20,588,000 759,771
Haci Omer Sabanci Holding AS 14,691,400 853,113
Turkiye Garanti Bankasi AS 17,854,025 920,491
Yapi Ve Kredi Bankasi AS 51,062,300 1,551,823
7,976,323
UNITED KINGDOM - 0.1%
Bakyrchik Gold PLC (a) 1,155,673 444,824
VENEZUELA - 0.9%
Electricidad de Caracas 2,031,312 2,667,689
Mavesa SA sponsored ADR 224,375 1,682,813
4,350,502
TOTAL COMMON STOCKS
(Cost $690,206,006) 445,364,199
CONVERTIBLE PREFERRED STOCKS - 0.1%
PHILIPPINES - 0.1%
PDCP Development Bank (a)
(Cost $859,496) 2,252,138 376,420
CONVERTIBLE BONDS - 1.5%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT (E)
MALAYSIA - 1.3%
Arab Malaysian Finance BHD:
7 1/2%, 11/20/99 - MYR 3,029,666 551,671
7 1/2%, 12/31/02
(For. Reg.) - MYR 9,240,292 1,379,148
Malaysian Plantations BHD
5%, 3/31/02 - MYR 16,268,000 2,452,340
Multi-Purpose Holdings BHD
3%, 1/13/02 - MYR 18,409,000 2,225,567
6,608,726
NETHERLANDS - 0.2%
Liblife International NV euro
6 1/2%, 9/30/04 - 1,000,000 1,080,000
TOTAL CONVERTIBLE BONDS
(Cost $22,623,711) 7,688,726
CASH EQUIVALENTS - 8.0%
Taxable Central Cash Fund (b)
(Cost $39,351,984) 39,351,984 39,351,984
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $753,041,197) $ 492,781,329
CURRENCY ABBREVIATIONS
MYR - Malaysian ringgit
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$5,185,782 or 1.0% of net assets.
(d) Affiliated Company (See Note 9 of Notes to Financial Statements).
(e) Principal amount in United States dollars unless otherwise noted.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $695,875,376 and $1,155,774,254, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $12,752 for the period.
The fund participated in the interfund lending program as a borrower.
The maximum loan and average daily balance during the period for which
loans were outstanding amounted to $15,455,000 and $8,912,333,
respectively. The weighted average interest rate was 5.62%. Interest
expense includes $8,355 paid under the interfund lending program (see
Note 5 of Notes to Financial Statements).
The fund participated in the bank borrowing program. The maximum loan
and average daily balance during the period for which loans were
outstanding amounted to $14,063,000 and $9,274,556, respectively. The
weighted average interest rate was 6.00%. Interest expense includes
$13,913 paid under the bank borrowing program (see Note 6 of Notes to
Financial Statements).
Transactions during the period with companies which are or were
affiliates are as follows:
PURCHASES SALES DIVIDEND VALUE
AFFILIATE COST COST INCOME
Asiamatrix Ltd. $ - $ 597,310 $ - $ -
Charan Insurance PCL (For. Reg.) - - - 160,487
Heilongjiang Electric Power Co.
Ltd. Class B - 1,069,187 - -
Liberty Telecoms Holdings, Inc. - 2,219,482 - -
PICOP Resources - 5,345,706 71,325 -
PT Apac Centertex Corp. - 6,485,466 - -
PT Bhuwanatala Indah Permai - 539,120 - -
PT Perdanacipta Multi Finance - - - 976,167
Tong Hua Daily News Co. Ltd.
(For. Reg.) - 69,807 11,347 63,881
Totals $ - $ 16,326,078 $ 82,672 $ 1,200,535
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Basic Industries 5.9%
Cash Equivalents 8.0
Construction & Real Estate 8.3
Durables 0.3
Energy 6.3
Finance 31.1
Health 0.6
Holding Companies 4.8
Media & Leisure 1.8
Nondurables 8.5
Precious Metals 4.1
Retail & Wholesale 2.3
Services 0.2
Technology 1.6
Utilities 16.2
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $756,864,473. Net unrealized depreciation
aggregated $264,083,144, of which $63,674,134 related to appreciated
investment securities and $327,757,278 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $97,011,000, all of which will expire on September 30,
2004.
EMERGING MARKETS
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
492,781,329
(COST $753,041,197) - SEE ACCOMPANYING SCHEDULE

CASH
59,959

FOREIGN CURRENCY HELD AT VALUE NEW TAIWAN DOLLARS (COST $15,781,881)
14,626,888

RECEIVABLE FOR INVESTMENTS SOLD
37,030,523

RECEIVABLE FOR FUND SHARES SOLD
1,464,676

DIVIDENDS RECEIVABLE
333,823

INTEREST RECEIVABLE
281,812

REDEMPTION FEES RECEIVABLE 1,976

TOTAL ASSETS
546,580,986

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 42,278,766

PAYABLE FOR FUND SHARES REDEEMED 4,207,058

ACCRUED MANAGEMENT FEE 373,054

OTHER PAYABLES AND 554,045

ACCRUED EXPENSES

TOTAL LIABILITIES
47,412,923

NET ASSETS $
499,168,063

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
895,064,634

DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME
(10,147,750)

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(124,068,621)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(261,680,200)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 48,217,859 $
499,168,063
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($499,168,063 (DIVIDED BY) 48,217,859 SHARES)
$10.35

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $10.35)
$10.67

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 23,657,583
DIVIDENDS (INCLUDING $82,672 RECEIVED FROM AFFILIATED ISSUERS)

INTEREST 1,792,482

25,450,065

LESS FOREIGN TAXES WITHHELD (1,870,645)

TOTAL INCOME 23,579,420

EXPENSES

MANAGEMENT FEE $ 7,910,780

TRANSFER AGENT FEES 3,447,197

ACCOUNTING FEES AND EXPENSES 588,031

NON-INTERESTED TRUSTEES' COMPENSATION 7,472

CUSTODIAN FEES AND EXPENSES 1,755,273

REGISTRATION FEES 54,846

AUDIT 92,473

LEGAL 13,578

INTEREST 22,268

REPORTS TO SHAREHOLDERS 167,025

MISCELLANEOUS 207,818

TOTAL EXPENSES BEFORE REDUCTIONS 14,266,761

EXPENSE REDUCTIONS (67,887) 14,198,874

NET INVESTMENT INCOME 9,380,546

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (INCLUDING 26,877,909
REALIZED LOSS OF $6,084,350
ON SALES OF INVESTMENTS IN
AFFILIATED ISSUERS)

FOREIGN CURRENCY TRANSACTIONS (581,894) 26,296,015

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES (355,716,778)

ASSETS AND LIABILITIES IN (1,341,873) (357,058,651)
FOREIGN CURRENCIES

NET GAIN (LOSS) (330,762,636)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (321,382,090)

OTHER INFORMATION $ 756,295
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 67,582
DIRECTED BROKERAGE ARRANGEMENTS

TRANSFER AGENT CREDITS 305

$ 67,887

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

OPERATIONS $ 9,380,546 $
9,827,956
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 26,296,015
(12,982,670)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) (357,058,651)
124,808,332

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (321,382,090)
121,653,618

DISTRIBUTIONS TO SHAREHOLDERS (9,380,546)
(12,640,733)
FROM NET INVESTMENT INCOME

IN EXCESS OF NET INVESTMENT INCOME (8,604,392)
(6,384,938)

TOTAL DISTRIBUTIONS (17,984,938)
(19,025,671)

SHARE TRANSACTIONS 345,209,422
640,979,260
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 17,580,514
18,581,507

COST OF SHARES REDEEMED (788,069,622)
(595,850,851)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (425,279,686)
63,709,916

REDEMPTION FEES 650,998 1,242,758

TOTAL INCREASE (DECREASE) IN NET ASSETS (763,995,716)
167,580,621

NET ASSETS

BEGINNING OF PERIOD 1,263,163,779
1,095,583,158

END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME OF $10,147,750 AND $ 499,168,063 $
1,263,163,779
$1,970,323, RESPECTIVELY)

OTHER INFORMATION

SOLD 20,888,778
38,644,131

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,073,294 1,242,911

REDEEMED (49,788,241)
(36,185,962)

NET INCREASE (DECREASE) (27,826,169) 3,701,080

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 D 1993

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 16.61 $ 15.14 $ 19.25 $ 16.18 $ 11.05

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .15 C .12 C .05 .06 .06 C

NET REALIZED AND UNREALIZED GAIN (LOSS) (6.17) 1.60 (4.13) 2.97 5.28

TOTAL FROM INVESTMENT OPERATIONS (6.02) 1.72 (4.08) 3.03 5.34

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.13) (.18) (.04) (.04) (.08)

IN EXCESS OF NET INVESTMENT INCOME (.12) (.09) - (.01) -

FROM NET REALIZED GAIN - - - - (.15)

TOTAL DISTRIBUTIONS (.25) (.27) (.04) (.05) (.23)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .01 .02 .01 .09 .02

NET ASSET VALUE, END OF PERIOD $ 10.35 $ 16.61 $ 15.14 $ 19.25 $ 16.18

TOTAL RETURN A, B (36.74)% 11.69% (21.17)% 19.32% 49.58%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 499,168 $ 1,263,164 $ 1,095,583 $ 1,976,371 $ 757,737

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.36% 1.30% 1.28% 1.52% 1.91%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.35% E 1.29% E 1.28% 1.52% 1.91%

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS .89% .74% .46% .39% .44%

PORTFOLIO TURNOVER RATE 69% 77% 78% 107% 57%

AVERAGE COMMISSION RATE F $ .0020 $ .0017

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME
SALES CHARGE. C NET INVESTMENT INCOME PER SHARE
HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING DURING THE
PERIOD. D EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED STATEMENT
OF POSITION 93-2, "DETERMINATION, DISCLOSURE, AND FINANCIAL
STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN, AND
RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES." AS A
RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. E
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH
THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES
(SEE NOTE 7 OF NOTES TO FINANCIAL STATEMENTS). F FOR FISCAL YEARS
BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED TO
DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY TRADES
ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD
TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED
IN VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE
STRUCTURES MAY DIFFER.

</TABLE>

EUROPE
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the past five year and past 10
year total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

EUROPE 23.35% 139.61% 227.80%

EUROPE (INCL. 3% SALES CHARGE) 19.65% 132.42% 217.97%

MORGAN STANLEY CAPITAL 26.30% 134.80% 258.32%
INTERNATIONAL EUROPE INDEX

EUROPEAN REGION 20.38% 127.37% 160.27%
FUNDS AVERAGE

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Morgan Stanley Capital International (MSCI) Europe Index - a market
capitalization weighted index of over 550 stocks traded in 14 European
markets. To measure how the fund's performance stacked up against its
peers, you can compare it to the European region funds average, which
reflects the performance of mutual funds with similar objectives
tracked by Lipper Analytical Services, Inc. The past one year average
represents a peer group of 68 mutual funds. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

EUROPE 23.35% 19.10% 12.61%

EUROPE (INCL. 3% SALES CHARGE) 19.65% 18.37% 12.26%

MORGAN STANLEY CAPITAL 26.30% 18.61% 13.61%
INTERNATIONAL EUROPE INDEX

EUROPEAN REGION 20.38% 17.72% 9.83%
FUNDS AVERAGE

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19971031 19971111 103817 S00000000000001
Europe MS Europe Index (Net)
00301 MS002
1987/10/31 9700.00 10000.00
1987/11/30 9266.75 9559.87
1987/12/31 9956.74 10115.96
1988/01/31 9483.37 9700.97
1988/02/29 9531.51 10271.84
1988/03/31 9972.79 10554.43
1988/04/30 10253.60 10751.10
1988/05/31 10141.27 10549.97
1988/06/30 9916.63 10443.56
1988/07/31 9812.32 10466.95
1988/08/31 9298.84 9991.83
1988/09/30 9732.09 10535.61
1988/10/31 10398.01 11511.36
1988/11/30 10526.39 11653.32
1988/12/31 10537.96 11715.90
1989/01/31 11038.21 12140.16
1989/02/28 11062.81 12002.31
1989/03/31 11251.43 12089.30
1989/04/30 11735.27 12424.84
1989/05/31 11415.44 11788.18
1989/06/30 11727.07 12274.54
1989/07/31 12776.76 13719.36
1989/08/31 12678.36 13547.99
1989/09/30 13252.41 13780.64
1989/10/31 12333.92 12877.12
1989/11/30 13055.59 13592.08
1989/12/31 13945.17 15055.08
1990/01/31 14119.38 15014.74
1990/02/28 13754.36 14654.95
1990/03/31 14169.15 14861.72
1990/04/30 13887.10 14467.32
1990/05/31 14741.56 15644.75
1990/06/30 15355.44 16194.22
1990/07/31 16284.57 16876.18
1990/08/31 14343.36 15202.92
1990/09/30 12924.79 13412.46
1990/10/31 13505.49 14542.74
1990/11/30 13488.90 14688.87
1990/12/31 13304.94 14476.74
1991/01/31 13568.15 14963.86
1991/02/28 14391.75 16272.78
1991/03/31 13619.10 15180.70
1991/04/30 13585.13 15022.00
1991/05/31 13644.57 15465.12
1991/06/30 12447.38 14167.19
1991/07/31 13075.69 15147.71
1991/08/31 13338.90 15424.26
1991/09/30 13822.87 15887.81
1991/10/31 13525.70 15553.11
1991/11/30 13118.15 15186.99
1991/12/31 13858.45 16374.92
1992/01/31 13919.88 16370.21
1992/02/29 14086.64 16433.06
1992/03/31 13603.92 15857.95
1992/04/30 14499.15 16733.19
1992/05/31 15210.06 17685.42
1992/06/30 15069.63 17356.07
1992/07/31 14525.48 16735.98
1992/08/31 14569.36 16681.41
1992/09/30 14341.17 16405.52
1992/10/31 13270.41 15260.84
1992/11/30 13261.63 15253.39
1992/12/31 13508.73 15603.32
1993/01/31 13437.16 15629.53
1993/02/28 13517.68 15808.34
1993/03/31 14403.35 16621.57
1993/04/30 14877.50 16988.17
1993/05/31 15056.42 17170.93
1993/06/30 14635.95 16920.08
1993/07/31 14644.90 16978.16
1993/08/31 15834.74 18468.01
1993/09/30 15816.85 18410.64
1993/10/31 16487.81 19177.62
1993/11/30 16165.75 18763.65
1993/12/31 17178.35 20172.39
1994/01/31 18418.21 21199.69
1994/02/28 17986.96 20448.92
1994/03/31 17483.83 19870.14
1994/04/30 17986.96 20692.94
1994/05/31 17295.15 19813.32
1994/06/30 17088.51 19605.30
1994/07/31 17870.16 20632.81
1994/08/31 18436.18 21287.23
1994/09/30 18184.62 20443.12
1994/10/31 19029.16 21333.69
1994/11/30 18319.38 20516.51
1994/12/31 18253.05 20633.14
1995/01/31 17860.61 20471.61
1995/02/28 18180.03 20935.43
1995/03/31 18618.11 21906.95
1995/04/30 19247.84 22607.53
1995/05/31 19631.15 23070.41
1995/06/30 20187.87 23287.90
1995/07/31 21091.40 24501.76
1995/08/31 20689.83 23554.57
1995/09/30 21602.48 24266.12
1995/10/31 21456.46 24151.51
1995/11/30 21319.56 24323.24
1995/12/31 21691.02 25094.04
1996/01/31 21757.56 25258.09
1996/02/29 22556.00 25718.23
1996/03/31 23107.31 26025.75
1996/04/30 23459.00 26214.06
1996/05/31 24133.88 26416.62
1996/06/30 24390.52 26707.50
1996/07/31 23924.76 26372.96
1996/08/31 24732.71 27155.56
1996/09/30 25150.94 27726.95
1996/10/31 25778.29 28370.65
1996/11/30 26766.84 29808.31
1996/12/31 27249.87 30385.72
1997/01/31 27137.22 30475.96
1997/02/28 27720.93 30887.38
1997/03/31 28243.19 31894.31
1997/04/30 28140.79 31743.78
1997/05/31 29451.57 33107.81
1997/06/30 30885.23 34772.47
1997/07/31 31858.08 36408.17
1997/08/31 30373.21 34334.37
1997/09/30 33189.34 37670.63
1997/10/31 31796.63 35831.93
IMATRL PRASUN SHR__CHT 19971031 19971111 103820 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity Europe Fund on October 31, 1987 and the current
3% sales charge was paid. As the chart shows, by October 31, 1997, the
value of the investment would have grown to $31,797 - a 217.97%
increase on the initial investment. For comparison, look at how the
the Morgan Stanley Capital International Europe Index did over the
same period. With dividends and capital gains, if any, reinvested, the
same $10,000 would have grown to $35,832 - a 258.32% increase.

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
EUROPE
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Sally Walden, Portfolio Manager of
Fidelity Europe Fund
Q. HOW DID THE FUND PERFORM, SALLY?
A. For the 12 months that ended October 31, 1997, the fund produced a
return of 23.35%. The Morgan Stanley Capital International Europe
Index returned 26.30% in that time frame, while the European region
funds average, as tracked by Lipper Analytical Services, returned
20.38%.
Q. ALTHOUGH THE FUND BEAT ITS LIPPER PEER GROUP, CAN YOU EXPLAIN WHY
IT UNDERPERFORMED THE INDEX?
A. The main reason for the underperformance versus the benchmark index
was the bias of the portfolio toward medium-sized companies. In most
European markets, stocks outside the market leaders trailed the rise
in large-capitalization, blue chip stocks. This was particularly the
case in the United Kingdom, where investors were worried that higher
interest rates and a stronger currency would have a negative impact on
the outlook for smaller companies. Investors also focused on companies
that were restructuring or benefited from the strength of the U.S.
dollar, and this favored large-cap stocks. In terms of sectors, the
fund's underexposure to technology stocks also kept the fund behind
the index.
Q. CAN YOU DESCRIBE THE MARKET ENVIRONMENT?
A. In general, most markets performed strongly, though there was a
fair degree of divergence in performance. With the exception of the
U.K., the strength of the U.S. dollar resulted in dollar-based
investors giving up some of their overall gains. The factors that
caused markets to rise were: (1) the stronger dollar, which made
European exports attractive; (2) lower interest rates and bond yields,
which improved the relative valuation of equities; (3) a pick-up in
economic growth that led to expectations of higher profit growth; and
(4) the positive effects from the rise in the U.S. stock market. The
best-performing market, in U.S. dollar terms, was Finland (up 45.2%),
which benefited from strong performances from communications company
Nokia and the overall financial sector. Italy (43.5%) and Spain
(37.4%) benefited from a sharp decline in bond yields, which made
equities look relatively attractive. The high return in Switzerland
(31.2%) can be attributed to continued restructuring and mergers among
some of the largest stocks in the market. The U.K. market returned
27.2% and the other major markets, Germany and France, returned 20.7%
and 15.0%, respectively.
Q. WHICH HOLDINGS PERFORMED PARTICULARLY WELL?
A. Many of the fund's financial sector positions performed strongly.
In the U.K., banks such as Lloyds TSB Group and Barclays announced
better-than-expected profit results. In Italy, Credito Italiano
announced restructuring plans and aggressive financial targets for its
underlying businesses. Corporate consolidation activity among Nordic
banks, such as Nordbanken, resulted in a strong performance from this
sector of the market. In the insurance sector, Skandia Foersaekrings
benefited from investor recognition that its life insurance business
was worth more than previously estimated. Among health care and
pharmaceutical companies, Amersham International merged with Nycomed;
and Ares Serono announced a dramatic profits recovery after previous
years of disappointment. Kuoni Reisen, a Swiss travel agency, saw a
boost to its profits from continued cost-cutting, restructuring and a
buoyant holiday market.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. In general, a number of media-related stocks underperformed the
market. In France, Canal Plus and TF1 suffered from increased
competition and a slowdown in advertising revenue. Both stocks were
sold out of the fund during the period. The turmoil in Southeast Asia
adversely impacted companies with exposure to the region, including
banking stocks HSBC and Standard Chartered Bank, and luxury goods
manufacturer Gucci. Deutsche Telecom announced disappointing profit
results, which caused its share price to decline. That position also
was sold during the period.
Q. HAVE THERE BEEN ANY MAJOR CHANGES TO COUNTRY WEIGHTINGS OVER THE
YEAR?
A. There have been modest changes to the geographical weightings in
the portfolio. The exposure to Scandinavia declined, but remained a
significant regional exposure at period's end. Sweden, which is the
largest market in the Nordic region, accounted for a dominant portion
of this exposure. The proportion of the fund invested in Germany was
increased, but that market is still underweighted in the fund relative
to the benchmark index. This reflects the difficulty in finding
companies that are managed in the interests of shareholders and are
attractively valued. Many of the largest holdings were U.K. stocks,
reflecting the fact that the U.K. is the largest market in Europe. The
U.K.'s weighting in the portfolio was in line with its weighting in
the index.
Q. IS THE FUND STILL BIASED TOWARD MEDIUM-SIZED COMPANIES?
A. Yes, but less so than a year ago. About two-thirds of the fund is
invested in stocks with market capitalizations above $5 billion, while
the benchmark index has 80% of its value in this tier of the market.
Over 25% of the fund is invested in companies with market
capitalizations between $500 million and $1 billion. To some extent,
the higher weighting in large-cap stocks has resulted in a more
concentrated portfolio. A year ago, the fund had about 135 holdings.
Now, there are close to 120.
Q. DID YOU FAVOR ANY PARTICULAR INDUSTRY SECTORS?
A. The largest exposure was to the financial sector, namely the stocks
of banks, and insurance and financial services companies. This sector
is experiencing a favorable consolidation trend as companies seek to
gain a competitive position in their home market and reduce costs
through mergers and acquisitions. We are also beginning to see mergers
between companies from different countries. Financial services
companies also are benefiting from growth in demand for savings
products. The health care sector - specifically pharmaceutical stocks
- - was also attractive. Most of these stocks are growth-oriented, but
some also represent restructuring or cost-cutting stories, such as
Novartis and Nycomed Amersham. The portion of the portfolio invested
in media companies has declined, but the sector remains overweighted
relative to the index.
Q. WHAT IS THE OUTLOOK FOR EUROPEAN MARKETS AND THE FUND?
A. European markets recently have suffered from the sharp declines in
markets in Southeast Asia and Japan. Looking ahead, it seems unlikely
that interest rates or bond yields will be as positive an influence on
share prices as they were last year, and the same may be true for the
effect of the strong U.S. dollar. Nevertheless, underlying business
prospects look healthy overall. Growth in the European economy is
broadening and I believe corporate profits could surprise on the
upside over the coming year. Valuations are also more reasonable after
these recent market corrections. Corporate restructuring should
continue to be an important theme in the market. As discussed
previously, the portfolio retains its bias toward medium-sized stocks.
It is in this segment of the market that I'm typically able to find
the most relative value. My stock selection favors companies with
predictable or visible profits growth. This may be achieved through
strong sales growth, restructuring or cost-cutting. I also have a
particular focus on companies that are managed in the interests of
shareholders and on companies that are moving in this direction. Given
the current investment environment, I'm comfortable with the way the
fund is positioned.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

SALLY WALDEN DISCUSSES EUROPE'S ONGOING CORPORATE
SHUFFLE:
"In Europe, October 13, 1997, has become known as `Mad
Monday.' On this day, six merger and acquisition deals worth
about $87 billion were announced within 45 minutes. In a
period when European markets were under pressure from
Asian and U.S. market volatility - not to mention the
previous week's rise in German interest rates - this `merger
mania' caused share prices in Europe to rise sharply. It is
very likely that such activity will continue, which could be
rewarding for stock pickers.
"Corporate activity has in fact been rising steadily over the
last few years; thus far in 1997, deals worth over $250 billion
were announced. The majority of these deals have been
domestic, but five of the six bids on `Mad Monday' involved
companies in different countries. This is a trend that could
gather momentum. There are a number of fundamental
developments in Europe that have encouraged this level
of activity. As we draw nearer to a uniform currency and a
single European market, companies increasingly see their
home market as Europe and not restricted by country borders.
"The sectors where market followers believe corporate
activity could be particularly high include aerospace and
defense, banks, engineering, food, retailing, paper and
telecommunications. The performance of the fund has
already benefited from takeover activity in some of these
sectors. The largest sector exposure in the fund is to
financial stocks, and over the last year, holdings linked
with consolidation activity included Nordbanken, BBL,
Lloyds TSB Group, Fokus Bank and Trygg Hansa. Other
holdings that have been the subject of consolidation include
Salomon, the French ski equipment manufacturer; Sandoz,
which merged with Ciba-Geigy to form Novartis; and Sun
Alliance, a U.K.-based insurance company that merged
with Royal Insurance.
"The increase in corporate activity has important
implications for stock selection and fund performance. At
Fidelity, each one of our 44 in-house analysts is responsible
for covering a sector on a pan-European basis. While we do
not actively seek out takeover or merger candidates, our
in-depth knowledge of industries often highlights those
sectors that could benefit from consolidation or companies
that have the attributes to make them attractive to an
acquiror .
"This background leads me to believe that emphasizing a
stock-picking approach should prove very rewarding over
the coming year. "

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of European issuers
FUND NUMBER: 301
TRADING SYMBOL: FIEUX
START DATE: October 1, 1986
SIZE: as of October 31, 1997, more than
$916 million
MANAGER: Sally Walden, since 1992; also
manages various funds for non-U.S. investors;
joined Fidelity in 1984
(checkmark)
EUROPE
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 2.6%
FRANCE 10.2%
ROW: 1, COL: 1, VALUE: 2.6
ROW: 1, COL: 2, VALUE: 34.5
ROW: 1, COL: 3, VALUE: 9.4
ROW: 1, COL: 4, VALUE: 9.699999999999999
ROW: 1, COL: 5, VALUE: 10.9
ROW: 1, COL: 6, VALUE: 5.5
ROW: 1, COL: 7, VALUE: 3.9
ROW: 1, COL: 8, VALUE: 3.4
ROW: 1, COL: 9, VALUE: 9.9
ROW: 1, COL: 10, VALUE: 10.2
GERMANY 9.9%
UNITED KINGDOM
34.5%
IRELAND 3.4%
ITALY 3.9%
NETHERLANDS 5.5%
OTHER 10.9%
SWITZERLAND 9.4%
SWEDEN 9.7%
AS OF APRIL 30, 1997
FRANCE 11.2%
UNITED STATES 5.9%
ROW: 1, COL: 1, VALUE: 5.9
ROW: 1, COL: 2, VALUE: 35.1
ROW: 1, COL: 3, VALUE: 8.6
ROW: 1, COL: 4, VALUE: 8.9
ROW: 1, COL: 5, VALUE: 3.6
ROW: 1, COL: 6, VALUE: 10.9
ROW: 1, COL: 7, VALUE: 4.2
ROW: 1, COL: 8, VALUE: 4.9
ROW: 1, COL: 9, VALUE: 6.7
ROW: 1, COL: 10, VALUE: 11.2
GERMANY 6.7%
ITALY 4.9%
UNITED KINGDOM
35.1%
NETHERLANDS 4.2%
OTHER 10.9%
SPAIN 3.6%
SWITZERLAND 8.6%
SWEDEN 8.9%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 97.4 94.1

SHORT-TERM INVESTMENTS 2.6 5.9

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

SHELL TRANSPORT & TRADING CO. PLC (REG.) 3.1 2.0
(UNITED KINGDOM, OIL & GAS)

NOVARTIS AG (REG.) 2.7 2.6
(SWITZERLAND, DRUGS & PHARMACEUTICALS)

LLOYDS TSB GROUP PLC 2.1 2.0
(UNITED KINGDOM, BANKS)

TOTAL SA CLASS B 2.1 1.6
(FRANCE, OIL & GAS)

BRITISH PETROLEUM PLC ORD. 2.1 2.3
(UNITED KINGDOM, OIL & GAS)

TELECOM ITALIA MOBILE SPA 2.0 2.3
(ITALY, TELEPHONE SERVICES)

GLAXO WELLCOME PLC 1.8 1.9
(UNITED KINGDOM, DRUGS & PHARMACEUTICALS)

HSBC HOLDINGS PLC ORD. 1.8 1.1
(UNITED KINGDOM, BANKS)

SKANDIA FOERSAEKRINGS AB 1.5 1.2
(SWEDEN, INSURANCE)

SMITHKLINE BEECHAM PLC ORD. 1.3 1.1
(UNITED KINGDOM, DRUGS & PHARMACEUTICALS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 27.8 27.3

HEALTH 12.8 12.6

ENERGY 8.9 7.7

UTILITIES 8.6 8.5

DURABLES 7.2 4.9

MEDIA & LEISURE 5.9 8.2

RETAIL & WHOLESALE 5.5 6.0

SERVICES 4.3 5.0

BASIC INDUSTRIES 3.6 1.8

CONSTRUCTION & REAL ESTATE 3.5 3.5

EUROPE
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 94.2%
SHARES VALUE (NOTE 1)
AUSTRIA - 0.5%
OMV AG 34,100 $ 4,848,341
BELGIUM - 1.0%
BBL (Banque Bruxelles Lambert) 35,700 9,059,692
DENMARK - 1.5%
Den Danske Bank Group AS 78,400 8,837,840
International Service Systems AS,
Series B (a) 159,300 4,829,111
13,666,951
FINLAND - 2.9%
Cultor OY Ord., Series 2 103,900 5,557,115
KCI (Konecranes International) 145,900 5,493,435
Sampo Insurance Co. Ltd. 263,800 7,895,154
Spontel OY Class A 554,900 3,428,616
UPM-Kymmene Corp. 175,500 3,947,818
26,322,138
FRANCE - 10.2%
Accor SA 5,808 1,079,773
Alcatel Alsthom Compagnie
Generale d'Electricite SA 66,300 7,987,744
BIC 61,240 4,183,056
Credit Commercial de France Ord. 124,900 7,065,548
Elf Sanofi SA 80,500 7,636,209
France Telecom SA 7,600 287,190
Groupe Photo Services GPS 32,200 5,178,130
Nationale Elf Aquitaine 79,200 9,788,695
Rhone Poulenc SA Class A 246,300 10,722,691
Societe Generale Class A 80,450 11,001,567
Total SA Class B 168,678 18,687,010
Union Assurancesfederale SA 68,194 7,613,902
91,231,515
GERMANY - 7.4%
Adidas AG 50,500 7,318,841
Allianz Aktiengesellschaft
Holdings (Reg.) 36,800 8,288,000
(BMW) Muenchen Bayerische
Motorenwerke AG 6,100 4,483,942
BHF Bank (Bank Berlin Hand) 148,700 4,482,551
Dresdner Bank AG Ord. 246,300 10,109,009
Gehe AG 154,910 8,172,064
Hoechst AG Ord. 206,400 7,885,072
Mannesmann AG Ord. 19,940 8,438,377
Veba AG Ord. 125,310 6,991,935
66,169,791
IRELAND - 3.4%
Bank of Ireland, Inc. 819,500 10,282,713
CRH PLC 678,360 8,162,343
IWP International (UK Reg.) 605,060 2,835,190
Independent Newspapers PLC 827,900 4,502,845
Smurfit (Jefferson) Group PLC 1,458,100 4,228,798
30,011,889
ITALY - 3.2%
Aeroporti di Roma Spa (a) 36,000 327,387
Credito Italiano Ord. 3,340,700 8,941,730
Istituto Bancario San Paolo 239,500 1,801,635
Telecom Italia Mobile Spa 4,853,340 17,914,922
28,985,674

SHARES VALUE (NOTE 1)
NETHERLANDS - 5.5%
Ahold NV 180,500 $ 4,612,262
AKZO Nobel NV 41,400 7,281,717
Gucci Group NV 82,600 3,036,452
ING Groep NV 195,350 8,185,617
Philips Electronics NV (Bearer) 94,800 7,408,535
Vendex International NV 125,600 6,845,039
VNU Ord. 484,000 11,446,787
48,816,409
NORWAY - 1.1%
Den Norske Bank AS Class A
Free shares 1,151,800 5,186,070
Schibsted AS, Series B 265,800 4,961,358
10,147,428
PORTUGAL - 1.3%
Banco Commercial Portugues
SA (Reg.) 264,200 5,367,968
Telecel Comunicacoes Pessoais SA 65,200 5,883,542
11,251,510
SPAIN - 2.6%
Banco Bilbao Vizcaya SA Ord. (Reg.) 373,800 9,972,443
Banco Intercontinental Espanol 54,400 2,663,850
Telefonica de Espana SA Ord. 389,600 10,607,722
23,244,015
SWEDEN - 9.7%
Assa Abloy AB Class B 203,965 4,639,576
Astra AB Class A Free shares 484,166 7,793,028
Hennes & Mauritz AB Class B 140,000 5,708,015
Incentive AB Class B 88,700 7,787,429
Naeckebro AB 19,900 280,599
Nordbanken AB 342,400 10,703,558
Nordbanken AB (c) 29,500 922,182
Securitas AB Class B 275,100 7,318,922
Skandia Foersaekrings AB 287,863 13,402,335
Svenska Handelsbanken 299,600 9,445,321
Swedish Match Co. 2,764,500 8,458,065
TV 4 AB Class A 147,430 2,373,000
Volvo AB Class B 303,220 7,905,703
86,737,733
SWITZERLAND - 9.4%
Adecco SA 13,428 4,351,295
ABB AG (Bearer) 6,130 7,999,464
Ares Serono Class B (Bearer) 4,710 8,924,920
Ciba Specialty Chemicals AG (a) 48,000 4,719,342
Credit Suisse Group (Reg.) 82,860 11,686,904
Kuoni Reisen Holding AG
Class B (Reg.) 2,818 10,679,585
Novartis AG (Reg.) 15,190 23,819,571
SGS Societe Generale de Surveillance
Holding SA (Bearer) 2,050 3,957,812
Swiss Reinsurance Corp. (Reg.) 5,313 8,012,240
84,151,133
UNITED KINGDOM - 34.5%
Asda Group PLC 1,920,100 4,980,595
Barclays PLC Ord. 431,570 10,782,930
Barratt Developments PLC 1,176,575 4,981,566
Boots Co. PLC Class L (The) 533,830 7,682,935
British Petroleum PLC Ord. 1,271,016 18,632,917

SHARES VALUE (NOTE 1)
UNITED KINGDOM - CONTINUED
British Telecommunications PLC Ord. 1,152,150 $ 8,734,397
Cable & Wireless PLC Ord. 518,500 4,130,298
Capital Shopping Centres PLC 769,521 5,576,145
Carpetright PLC 574,300 5,132,226
Cookson Group PLC 813,800 3,254,927
Daily Mail & General Trust PLC
Class A 159,100 4,486,377
Electrocomponents PLC 614,020 4,778,165
Flextech PLC (a) 810,280 7,932,621
Gallaher Group PLC 1,093,100 5,213,513
Glaxo Wellcome PLC 769,300 16,453,273
Granada Group PLC 374,300 5,148,934
Grand Metropolitan PLC 656,000 5,906,250
Great Universal Stores PLC Ord.
Class A 601,300 7,109,337
HSBC Holdings PLC Ord. 634,800 15,775,716
Ladbroke Group PLC Ord. 1,027,700 4,592,015
Lloyds TSB Group PLC 1,514,200 18,878,402
London Insurance Market Investment
Trust PLC 3,189,770 7,313,170
Mercury Asset Management
Group PLC 202,800 4,437,401
National Grid Co. PLC 1,279,700 6,017,834
Next PLC 541,400 6,432,834
Nycomed Amersham PLC 193,200 7,404,033
Prudential Corp. PLC 511,870 5,448,068
Rentokil Initial PLC 1,311,400 5,157,376
Royal & Sun Alliance Insurance
Group PLC 519,093 4,964,633
Scottish Television PLC 382,530 4,129,058
Shell Transport & Trading Co.
PLC (Reg.) 3,962,500 28,033,588
Smiths Industries PLC Ord. 344,370 4,985,023
SmithKline Beecham PLC Ord. 1,268,220 11,991,369
Standard Chartered Bank PLC 312,760 3,386,423
Tesco PLC Ord. 661,920 5,286,608
Unilever PLC Ord. 1,254,400 9,320,618
Vendome Luxury Group PLC SA 464,200 2,816,040
Vodafone Group PLC 1,696,325 9,240,294
Wolseley PLC Ord. 507,450 4,226,981
Zeneca Group PLC Ord. 250,180 7,875,300
308,630,190
TOTAL COMMON STOCKS
(Cost $609,277,518) 843,274,409
NONCONVERTIBLE PREFERRED STOCKS - 3.2%
GERMANY - 2.5%
Boss (Hugo) AG 5,080 6,419,942
Volkswagen AG 23,530 10,789,699
Wella AG 7,118 4,992,916
22,202,557
ITALY - 0.7%
Telecom Italia Spa 1,585,500 6,384,361
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $18,047,631) 28,586,918
CASH EQUIVALENTS - 2.6%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $23,677,322) 23,677,322 $ 23,677,322
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $651,002,471) $ 895,538,649
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to $922,182
or 0.1% of net assets.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $533,873,605 and $468,819,019, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $196,495 for the period.
The fund participated in the bank borrowing program. The maximum loan
and average daily balances during the period for which loans were
outstanding amounted to $14,575,000 and $9,156,091, respectively. The
weighted average interest rate was 5.24% (see Note 6 of Notes to
Financial Statements).
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.6%
Basic Industries 3.6
Cash Equivalents 2.6
Construction & Real Estate 3.5
Durables 7.2
Energy 8.9
Finance 27.8
Health 12.8
Holding Companies 1.5
Industrial Machinery & Equipment 2.5
Media & Leisure 5.9
Nondurables 3.3
Retail & Wholesale 5.5
Services 4.3
Technology 1.4
Utilities 8.6
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $651,262,206. Net unrealized appreciation
aggregated $244,276,443, of which $262,655,727 related to appreciated
investment securities and $18,379,284 related to depreciated
investment securities.
The fund hereby designates approximately $12,843,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
EUROPE
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
895,538,649
(COST $651,002,471) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
21,009,306

RECEIVABLE FOR FUND SHARES SOLD
1,249,146

DIVIDENDS RECEIVABLE
2,746,235

INTEREST RECEIVABLE 80,962

REDEMPTION FEES RECEIVABLE 1,170

TOTAL ASSETS
920,625,468

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 990,554

PAYABLE FOR FUND SHARES REDEEMED 2,553,217

ACCRUED MANAGEMENT FEE 588,934

OTHER PAYABLES AND ACCRUED EXPENSES 384,713

TOTAL LIABILITIES
4,517,418

NET ASSETS $
916,108,050

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
579,544,239

UNDISTRIBUTED NET INVESTMENT INCOME
12,950,679

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
79,010,019

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
244,603,113
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 29,500,573 $
916,108,050
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($916,108,050 (DIVIDED BY) 29,500,573 SHARES) $31.05

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $31.05) $32.01

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 25,724,785
DIVIDENDS

INTEREST 1,380,075

27,104,860

LESS FOREIGN TAXES WITHHELD (3,335,291)

TOTAL INCOME 23,769,569

EXPENSES

MANAGEMENT FEE $ 6,535,456
BASIC FEE

PERFORMANCE ADJUSTMENT 327,476

TRANSFER AGENT FEES 2,306,859

ACCOUNTING FEES AND EXPENSES 518,194

NON-INTERESTED TRUSTEES' COMPENSATION 3,391

CUSTODIAN FEES AND EXPENSES 454,910

REGISTRATION FEES 76,265

AUDIT 57,163

LEGAL 7,537

INTEREST 14,662

REPORTS TO SHAREHOLDERS 112,827

MISCELLANEOUS 4,545

TOTAL EXPENSES BEFORE REDUCTIONS 10,419,285

EXPENSE REDUCTIONS (54,351) 10,364,934

NET INVESTMENT INCOME 13,404,635

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 80,203,387

FOREIGN CURRENCY TRANSACTIONS (242,041) 79,961,346

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 86,777,130

ASSETS AND LIABILITIES IN 29,918 86,807,048
FOREIGN CURRENCIES

NET GAIN (LOSS) 166,768,394

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 180,173,029

OTHER INFORMATION $ 729,707
SALES CHARGES PAID TO FDC

DEFERRED SALES CHARGES WITHHELD $ 20,431
BY FDC

EXPENSE REDUCTIONS $ 31,902
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 93

TRANSFER AGENT CREDITS 22,356

$ 54,351

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 13,404,635 $ 6,716,135
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 79,961,346 51,588,573

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 86,807,048 45,251,666

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 180,173,029 103,556,374

DISTRIBUTIONS TO SHAREHOLDERS (6,427,940) (2,532,705)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (46,294,939) (17,095,667)

TOTAL DISTRIBUTIONS (52,722,879) (19,628,372)

SHARE TRANSACTIONS 355,908,188 240,208,198
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 51,814,504 19,284,800

COST OF SHARES REDEEMED (311,301,709) (144,811,084)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 96,420,983 114,681,914

REDEMPTION FEES 475,113 284,527

TOTAL INCREASE (DECREASE) IN NET ASSETS 224,346,246 198,894,443

NET ASSETS

BEGINNING OF PERIOD 691,761,804 492,867,361

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $12,950,679 AND
$6,366,458, RESPECTIVELY) $ 916,108,050 $ 691,761,804

OTHER INFORMATION
SHARES

SOLD 12,685,159 9,582,175

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 2,034,335 860,545

REDEEMED (10,729,871) (5,896,676)

NET INCREASE (DECREASE) 3,989,623 4,546,044

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 C 1993

<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 27.12 $ 23.51 $ 21.18 $ 18.43 $ 15.12

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .44 G .30 G .27 .18 .25

NET REALIZED AND UNREALIZED GAIN (LOSS) 5.44 4.23 2.37 2.65 3.35

TOTAL FROM INVESTMENT OPERATIONS 5.88 4.53 2.64 2.83 3.60

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.24) (.12) (.20) (.08) (.29)

FROM NET REALIZED GAIN (1.73) (.81) (.11) - -

TOTAL DISTRIBUTIONS (1.97) (.93) (.31) (.08) (.29)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .02 .01 - - -

NET ASSET VALUE, END OF PERIOD $ 31.05 $ 27.12 $ 23.51 $ 21.18 $ 18.43

TOTAL RETURN A, B 23.35% 20.14% 12.76% 15.41% 24.24%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 916,108 $ 691,762 $ 492,867 $ 507,460 $ 528,929

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.19% 1.27% 1.18% D 1.35% 1.25%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS 1.18% F 1.27% 1.18% 1.35% 1.25%

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.53% 1.20% 1.12% .85% 1.44%

PORTFOLIO TURNOVER RATE 57% 45% 38% 49% 76%

AVERAGE COMMISSION RATE E $ .0344 $ .0299

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME
SALES CHARGE. C EFFECTIVE NOVEMBER 1, 1993, THE
FUND ADOPTED STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE,
AND FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN, AND
RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES." AS A
RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. D FMR
AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER. E FOR FISCAL YEARS BEGINNING ON OR AFTER
SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE
COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS
ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND
TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS
MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES
MAY DIFFER. F FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS
WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE
FUND'S EXPENSES (SEE NOTE 7 OF NOTES TO FINANCIAL
STATEMENTS). G NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED
BASED ON AVERAGE SHARES OUTSTANDING DURING THE PERIOD.

</TABLE>

EUROPE CAPITAL APPRECIATION
PERFORMANCE: THE BOTTOM LINE

EUROPE CAPITAL APPRECIATION 31.57% 88.72%

EUROPE CAPITAL APPRECIATION 27.62% 83.06%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL 26.30% 79.18%
INTERNATIONAL EUROPE INDEX

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on December 21, 1993. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Morgan Stanley Capital International (MSCI) Europe
Index - a market capitalization weighted index of over 550 stocks
traded in 14 European markets. To measure how the fund's performance
stacked up against its peers, you can compare it to the European
region funds average, which reflects the performance of mutual funds
with similar objectives tracked by Lipper Analytical Services, Inc.
The past one year average represents a peer group of 68 mutual funds.
These benchmarks include reinvested dividends and capital gains, if
any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

EUROPE CAPITAL APPRECIATION 31.57% 17.87%

EUROPE CAPITAL APPRECIATION 27.62% 16.94%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL 26.30% 16.30%
INTERNATIONAL EUROPE INDEX

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
EUROPE CAPITAL APPRECIATION
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Kevin McCarey, Portfolio Manager of Fidelity Europe
Capital Appreciation Fund
Q. HOW DID THE FUND PERFORM, KEVIN?
A. For the 12 months that ended October 31, 1997, the fund generated a
total return of 31.57%. In contrast, the Morgan Stanley Capital
International Europe Index returned 26.30% in that time frame. The
European region funds average, a peer group of competitor funds
tracked by Lipper Analytical Services, returned 20.38%.
Q. HOW WOULD YOU CHARACTERIZE THE INVESTING CLIMATE IN EUROPE OVER THE
PAST 12 MONTHS?
A. The most important factor during the period was the fact that many
European markets posted outstanding returns. European economies
continued to show signs of improvement during the period, and much of
this can be attributed to the drive toward a uniform currency
throughout Europe. The convergence of monetary and fiscal policies
between smaller, peripheral countries and those that are slightly more
established has been very beneficial. These favorable economic
conditions served as a nice backdrop for the restructuring plans that
many companies continued to implement.
Q. WHAT FACTORS INFLUENCED THE FUND'S RETURN?
A. The continued proliferation of company restructurings played to one
of Fidelity's main strengths - bottom-up analysis of individual
stocks. When companies are engaged in restructuring programs - be it
cutting personnel, eliminating or reducing the focus on non-essential
subdivisions or re-working their balance sheets - it really puts an
emphasis on understanding what each company is doing and what it is
trying to achieve. Our international research team was able to
effectively pool its resources and come up with a number of individual
winners. Relative to its peer group of funds - many of which tend to
be more concentrated in medium-company growth stocks - the fund had
perhaps a better balance of small-, medium- and large-company stocks.
In the type of environment we've seen - where markets rewarded both
large and small stocks - having a balance of both worked to the fund's
advantage. In addition, the fund realized beneficial results from
several industry groups.
Q. WOULD ONE OF THOSE GROUPS BE PHARMACEUTICAL STOCKS, WHICH ACCOUNTED
FOR THREE OF THE FUND'S TOP 10 POSITIONS AT THE END OF THE PERIOD?
A. Yes. The pharmaceutical group saw a fair amount of merger and
acquisition activity during the period, much of which was positive.
Novartis, the fund's third-largest position at the end of the period,
is a prime example. Sandoz and Ciba-Geigy, formerly two large
companies on their own, merged together in 1996 to form Novartis. When
the new company was formed, it laid out an ambitious but achievable
three-year cost-cutting plan. We have just begun to see positive
results from this undertaking and, if all goes according to plan,
should see continued improvement. In addition, pharmaceutical
companies typically have low capital spending requirements and high
profitability rates. As a result, many pharmaceutical companies were
able to generate strong cash flows.
Q. THE FUND CONTINUED TO HAVE SIGNIFICANT EXPOSURE TO THE FINANCE
SECTOR, BUT YOU REDUCED ITS EXPOSURE TO UTILITY STOCKS . . .
A. Finance is the largest market sector in Europe, and the fund has
historically had a significant weighting in these types of stocks. On
average, most of the fund's bank holdings during the period performed
well, but Italian bank Credito Italiano was a standout. Credito
Italiano went through a major restructuring and unveiled a three-year
plan for improving its return on equity. In doing so, many investors
went from believing the company had no plan to accepting its
turnaround strategy, and the stock performed extremely well. Credito
Italiano is also one of the top three mutual fund companies in Italy
and has seen tremendous inflows in that area of its business. In terms
of the utility exposure, I reduced the fund's positions in U.K.-based
utility stocks, particularly Thames Water, Yorkshire Water and
National Grid. I had bought these stocks at low valuations due to
regulatory concerns, and when their share prices rebounded, I sold
some shares to lock in profits.
Q. HOW DID THE FUND'S TECHNOLOGY POSITIONS FARE?
A. The two best contributors to the fund's return during the period -
Philips Electronics and ASM Lithography - were technology-related
stocks. Philips was one of the best restructuring stories in all of
Europe as the company cut staff, closed down several unprofitable
divisions and focused on cash generation. As a result, the company
enjoyed a nice run during the period. ASM Lithography, an equipment
manufacturer for semiconductor producers, has one of the leading-edge
technologies involved in the low-cost production of semiconductor
chips. This process, called "deep ultraviolet lithography," grew
quickly in demand and played a large role in the stock's success. In
August, however, I began to reduce these positions. I felt strongly
that U.S. tech stocks had reached their performance ceiling, and that
this would have a ripple effect on other world markets. Since tech
stocks were negatively affected by the late-October economic turmoil
in Southeast Asia, this move may have helped the fund sidestep some
potential problems.
Q. WERE THERE ANY REGIONAL SURPRISES?
A. By aggressively pursuing business opportunities for itself, Ireland
dramatically improved its economic standing. Part of Ireland's
strategy has been to offer lower tax rates to companies doing business
there. Intel and Microsoft, for example, have established
manufacturing plants in Ireland and financial services companies have
sprouted up all over the Emerald Isle. The fund has some exposure to
Ireland, most notably its longstanding position in the Bank of
Ireland.
Q. YOU'VE MENTIONED A NUMBER OF INDIVIDUAL HOLDINGS THAT PERFORMED
WELL. CAN YOU NAME A FEW THAT DIDN'T PERFORM SO WELL?
A. Slow sales growth and disappointing earnings streams hurt both
Frontec - a small, technology-related company no longer held by the
fund - and Astra, a Swedish pharmaceutical firm. Inchcape, a British
marketing company with some exposure to Southeast Asia, was negatively
affected by that region's economic turmoil toward the end of the
period.
Q. WHAT'S YOUR OUTLOOK?
A. European economies should continue to improve, but the improvement
may be slightly more muted due to the problems in Southeast Asia. In
terms of picking stocks, I'll continue to focus on companies that show
good earnings promise, whether through product momentum or
restructuring programs. Our talented research group will continue to
sift through the various restructurings, pore over the details and try
to come up with more winners.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

KEVIN MCCAREY DISCUSSES THE SOUTHEAST ASIAN
DILEMMA AND WHAT IT MEANS FOR EUROPE:
"While it was many months in the making, the economic
collapse of Southeast Asia in late October still shook the
world's financial markets. When a region that accounts for
almost one-third of the world's economic growth - as
Southeast Asia does - tumbles so dramatically, it's time to sit
up and take notice.
"The Asian debacle will leave a negative imprint in Europe,
particularly on companies that export goods to that region.
Some European companies - such as Philips Electronics and
Unilever, both of which the fund owned during the period -
have had pretty strong demand from Asia and that business
will likely slow down. On the other hand, Philips does a lot of
its manufacturing in Asia, so while local product demand will
subside, the company's production costs will be lower.
"In general, global investors have been attracted to the `sex
appeal' of emerging markets growth. Emerging markets can
often post absurdly high returns, but the problems in Asia
illustrate that the opposite holds true as well. By nature,
emerging market investments are subject to more risk - be
it financial or political - than more established nations or
domestic investments. With this increased risk awareness,
investors searching for attractive foreign opportunities may
set their sights on Europe and Japan.
"In terms of the fund itself, our crack research team was able
to avoid most significant Asia-related losses. One company
that we were analyzing in the summertime had a significant
order from Asia postponed, which served as somewhat of a
tip-off that an economic slowdown might be imminent.
"For investors in the fund who may be wary of what's gone on in
Southeast Asia, I would offer this: In contrast to that region,
Europe is a fairly developed economy. As countries strive to
meet the requirements for establishing a uniform currency,
we've seen a convergence in fiscal policymaking that has made
some of the smaller European countries slightly more stable.
Additionally, Europe has one of the most prudent central
banks - the German Bundesbank - overseeing monetary
matters. Theoretically, Europe has a more stable risk profile
than that of Asia."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of eastern and
western European issuers
FUND NUMBER: 341
TRADING SYMBOL: FECAX
START DATE: December 21, 1993
SIZE: as of October 31, 1997, more than
$372 million
MANAGER: Kevin McCarey, since inception;
manager, Fidelity Select Financial Services
Portfolio, Fidelity Select Automotive Portfolio,
1988-1990; Fidelity Select Regional Banks
Portfolio, 1986-1989; joined Fidelity in 1985
(checkmark)
EUROPE CAPITAL APPRECIATION
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
FRANCE 20.1%
UNITED STATES 5.8%
ROW: 1, COL: 1, VALUE: 5.8
ROW: 1, COL: 2, VALUE: 29.7
ROW: 1, COL: 3, VALUE: 6.5
ROW: 1, COL: 4, VALUE: 4.5
ROW: 1, COL: 5, VALUE: 10.6
ROW: 1, COL: 6, VALUE: 8.5
ROW: 1, COL: 7, VALUE: 5.9
ROW: 1, COL: 8, VALUE: 3.1
ROW: 1, COL: 9, VALUE: 5.3
ROW: 1, COL: 10, VALUE: 20.1
UNITED KINGDOM 29.7%
GERMANY 5.3%
IRELAND 3.1%
ITALY 5.9%
SWITZERLAND 6.5%
NETHERLANDS 8.5%
OTHER 10.6%
SWEDEN 4.5%
AS OF APRIL 30, 1997
FRANCE 13.8%
UNITED STATES 12.3%
ROW: 1, COL: 1, VALUE: 12.3
ROW: 1, COL: 2, VALUE: 28.3
ROW: 1, COL: 3, VALUE: 7.0
ROW: 1, COL: 4, VALUE: 5.0
ROW: 1, COL: 5, VALUE: 4.1
ROW: 1, COL: 6, VALUE: 7.6
ROW: 1, COL: 7, VALUE: 12.3
ROW: 1, COL: 8, VALUE: 3.6
ROW: 1, COL: 9, VALUE: 6.0
ROW: 1, COL: 10, VALUE: 13.8
UNITED KINGDOM 28.3%
GERMANY 6.0%
ITALY 3.6%
NETHERLANDS 12.3%
OTHER 7.6%
SWITZERLAND 7.0%
SWEDEN 5.0%
SPAIN 4.1%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 94.1 89.9

BONDS 0.1 0.0

SHORT-TERM INVESTMENTS 5.8 10.1

TOP TEN STOCKS

<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

RHONE POULENC SA CLASS A 4.2 1.8
(FRANCE, DRUGS & PHARMACEUTICALS)

SHELL TRANSPORT & TRADING CO. PLC (REG.) (UNITED KINGDOM, OIL & GAS) 4.0 0.3

NOVARTIS AG (REG.) 3.8 2.6
(SWITZERLAND, DRUGS & PHARMACEUTICALS)

NATIONALE ELF AQUITAINE 3.2 1.9
(FRANCE, OIL & GAS)

SMITHKLINE BEECHAM PLC ORD. 2.1 1.2
(UNITED KINGDOM, DRUGS &
PHARMACEUTICALS)

ALCATEL ALSTHOM COMPAGNIE GENERALE 1.9 1.6
D'ELECTRICITE SA
(FRANCE, ELECTRICAL EQUIPMENT)

BRITISH AEROSPACE PLC 1.8 1.0
(UNITED KINGDOM, AEROSPACE & DEFENSE)

TOTAL SA CLASS B 1.8 0.9
(FRANCE, OIL & GAS)

CORDIANT PLC 1.8 1.3
(UNITED KINGDOM, ADVERTISING)

TELECOM ITALIA SPA 1.7 1.0
(ITALY, TELEPHONE SERVICES)

</TABLE>

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 19.6 18.5

HEALTH 13.3 10.2

ENERGY 12.5 4.1

BASIC INDUSTRIES 5.7 6.5

CONSTRUCTION & REAL ESTATE 5.5 3.2

DURABLES 5.4 7.3

MEDIA & LEISURE 5.2 4.4

UTILITIES 5.2 10.0

INDUSTRIAL MACHINERY & EQUIPMENT 4.6 2.1

RETAIL & WHOLESALE 4.0 3.5

EUROPE CAPITAL APPRECIATION
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 93.3%
SHARES VALUE (NOTE 1)
AUSTRIA - 1.7%
Austria Tabak AG (c) 103,400 $ 4,303,894
Voest-Alpine Stahl AG 50,000 2,163,610
6,467,504
BELGIUM - 2.2%
BBL (Banque Bruxelles Lambert) 23,500 5,963,662
Petrofina SA 7,000 2,572,155
8,535,817
CANADA - 0.4%
Canadian Fracmaster Ltd. 84,200 1,389,932
DENMARK - 0.7%
International Service Systems AS,
Series B (a) 66,500 2,015,919
Radiometer AS Class B 18,000 767,766
2,783,685
FINLAND - 1.6%
Cultor OY, Series 1 20,000 1,023,364
Merita Ltd. Class A 333,000 1,626,743
Outokumpu OY Class A 50,000 748,214
UPM-Kymmene Corp. 120,000 2,699,363
6,097,684
FRANCE - 20.1%
Accor SA 13,000 2,416,846
Alcatel Alsthom Compagnie
Generale d'Electricite SA 60,000 7,228,728
Axime SA Ex Segin (a) 7,500 834,783
Cap Gemini Sogeti SA 60,000 4,756,835
Compagnie Bancaire Ord. 27,500 3,522,620
Credit Commercial de France Ord. 40,000 2,262,786
L'Oreal Co. Ord. 2,700 955,314
Michelin SA (Compagnie Generale des
Etablissements) Class B 29,273 1,499,386
Nationale Elf Aquitaine 99,000 12,235,868
NRJ SA 17,000 2,354,183
Pechiney SA Class A 92,402 3,794,001
Rhone Poulenc SA Class A 370,000 16,107,981
Skis Rossignol SA 98,600 1,950,853
Societe Generale Class A 37,534 5,132,788
Total SA Class B 62,000 6,868,676
Usinor Sacilor 300,000 4,959,364
76,881,012
GERMANY - 5.3%
Allianz Aktiengesellschaft Holdings (Reg.) 10,000 2,252,174
BHF Bank (Bank Berlin Hand) 200,000 6,028,986
Daimler-Benz AG Ord. 60,000 4,027,826
Gehe AG 1,400 73,855
Hoechst AG Ord. 33,000 1,260,696
Hornbach Baumarket AG (Bearer) 31,163 923,147
Lufthansa Deutsche AG (Reg.) 160,000 2,861,449
Mannesmann AG Ord. 1,900 804,058
Siemens AG 30,000 1,836,522
20,068,713
IRELAND - 3.1%
Bank of Ireland, Inc. 370,000 4,642,592
Dana Petroleum PLC (a) 2,500,000 983,181
Elan Corp. PLC ADR (a) 65,000 3,241,875
Smurfit (Jefferson) Group PLC 975,000 2,827,706
11,695,354

SHARES VALUE (NOTE 1)
ITALY - 5.1%
Autogrill Spa (a) 102,476 $ 470,259
Credito Italiano Ord. 2,240,000 5,995,592
Eni Spa 550,000 3,108,304
Telecom Italia Spa 1,013,900 6,341,402
Toro Assicurazioni Spa Ord. 301,000 3,597,905
19,513,462
NETHERLANDS - 8.5%
Ahold NV 80,000 2,044,216
AKZO Nobel NV 28,000 4,924,833
Apothekers Cooperatie OPG 19,300 580,488
ASM Lithography Holding NV 43,000 3,149,750
Fortis Amev NV 41,884 1,643,059
ING Groep NV 100,000 4,190,231
Koninklijke Hoogovens NV 20,000 915,167
Philips Electronics NV 70,000 5,486,250
Philips Electronics NV (Bearer) 36,000 2,813,368
Samas-Groep NV 25,500 1,160,283
VNU Ord. 160,000 3,784,062
Vendex International NV 34,000 1,852,956
32,544,663
NORWAY - 1.4%
Det Sondenfjelds-Norske
Dampskibselskab Class A (a) 125,000 2,796,301
NCL Holdings AS (a) 700,000 2,673,050
5,469,351
PORTUGAL - 0.3%
Cimpor-Cimentos de Portugal SA 50,000 1,262,770
SPAIN - 2.3%
Cortefiel SA 15,000 534,943
Telefonica de Espana SA sponsored ADR 70,000 5,757,500
Tele Pizza SA (a) 35,000 2,397,984
8,690,427
SWEDEN - 4.5%
Astra AB Class A Free shares 150,000 2,414,366
Esselte AB Class B Free shares 96,000 2,081,543
Incentive AB Class A 11,000 959,894
Nordbanken AB 60,000 1,875,624
Svenska Handelsbanken 120,000 3,783,173
Swedish Match Co. 800,000 2,447,622
Trygg Hansa AB Class B 22,500 716,827
Volvo AB ADR Class B 105,000 2,730,000
17,009,049
SWITZERLAND - 6.5%
Credit Suisse Group (Reg.) 11,000 1,551,484
Julius Baer Holding AG 1,700 2,540,579
Nestle SA (Reg.) 1,100 1,551,877
Novartis AG (Reg.) 9,300 14,583,411
Saurer AG Arbon (Reg.) 4,500 2,979,621
Sulzer AG (Reg.) 2,000 1,464,426
24,671,398
UNITED KINGDOM - 29.6%
British Aerospace PLC 260,000 6,883,440
Bank of Scotland 360,000 2,964,103
Barclays PLC Ord. 200,000 4,997,071
British Petroleum PLC Ord. 270,000 3,958,162
British Land Co. PLC (The) Ord. 209,800 2,440,147
Caradon PLC 1,100,000 3,497,615
Cookson Group PLC 520,000 2,079,826
Cordiant PLC 3,250,805 6,691,473
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
UNITED KINGDOM - CONTINUED
Courtaulds Textiles PLC 85,000 $ 486,486
Devro PLC 316,900 1,956,926
Dorling Kindersley Holdings PLC Class L 573,200 2,733,863
DR Solomons Group PLC sponsored ADR 62,500 1,914,063
Glaxo Wellcome PLC 240,000 5,132,959
Graham Group PLC 850,000 2,332,859
Hanson Trust PLC Ord. 200,000 1,020,835
Inchcape PLC Ord. 610,000 2,225,420
KBC Advanced Technologies PLC (a) 225,000 1,204,920
Kingfisher PLC 150,000 2,153,795
Kalon Group PLC 198,500 488,319
Lloyds TSB Group PLC 500,000 6,233,788
Misys PLC Ord. 60,000 1,518,199
National Grid Co. PLC 375,000 1,763,451
Pearson PLC 89,500 1,168,270
Persimmon PLC Ord. 400,000 1,432,516
Pilkington PLC:
Ord. 1,600,000 4,016,400
Class L, warrants 5/4/98 (a) 1,125,000 658,941
Rentokil Initial PLC 945,000 3,716,425
Scholl PLC 200,000 927,119
Shell Transport & Trading Co. PLC (Reg.) 2,165,000 15,316,774
SmithKline Beecham PLC Ord. 860,700 8,138,155
Somerfield PLC 1,400,000 4,498,368
Storehouse PLC 250,000 924,609
Unilever PLC Ord. 600,000 4,458,204
Vodafone Group PLC 300,000 1,634,173
Wickes PLC (a) 66,400 243,354
Yorkshire Water PLC 167,500 1,302,046
113,113,074
TOTAL COMMON STOCKS
(Cost $326,844,605) 356,193,895
NONCONVERTIBLE PREFERRED STOCKS - 0.8%
ITALY - 0.8%
Telecom Italia Mobile Spa de Risp
(Cost $2,392,300) 1,500,000 3,065,219
CONVERTIBLE BONDS - 0.1%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT (D)
UNITED KINGDOM - 0.1%
Misys (Jersey) Ltd. 8%, 5/30/98
(Cost $373,377) - GBP 17,142 421,701
CASH EQUIVALENTS - 5.8%
SHARES
Taxable Central Cash Fund (b)
(Cost $22,231,010) 22,231,010 22,231,010
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $351,841,292) $ 381,911,825
CURRENCY ABBREVIATIONS
GBP - British pound
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$4,303,894 or 1.2% of net assets.
(d) Principal amount is stated in United States dollars unless
otherwise noted.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $704,009,160 and $580,023,033, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $153,873 for the period.
The fund participated in the bank borrowing program. The maximum loan
and average daily balances during the period for which loans were
outstanding amounted to $3,058,000 and $2,137,000, respectively. The
weighted average interest rate was 5.66% (see Note 6 of Notes to
Financial Statements).
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 1.8%
Basic Industries 5.7
Cash Equivalents 5.8
Construction & Real Estate 5.5
Durables 5.4
Energy 12.5
Finance 19.6
Health 13.3
Holding Companies 0.5
Industrial Machinery & Equipment 4.6
Media & Leisure 5.2
Nondurables 4.0
Retail & Wholesale 4.0
Services 2.8
Technology 2.6
Transportation 1.5
Utilities 5.2
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $352,384,593. Net unrealized appreciation
aggregated $29,527,232, of which $38,507,019 related to appreciated
investment securities and $8,979,787 related to depreciated investment
securities.
The fund hereby designates approximately $16,118,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
EUROPE CAPITAL APPRECIATION
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
381,911,825
(COST $351,841,292) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
592,681

RECEIVABLE FOR FUND SHARES SOLD
444,815

DIVIDENDS RECEIVABLE
1,159,153

INTEREST RECEIVABLE 60,212

REDEMPTION FEES RECEIVABLE 226

TOTAL ASSETS
384,168,912

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 9,724,886

PAYABLE FOR FUND SHARES REDEEMED 1,977,314

ACCRUED MANAGEMENT FEE 238,949

OTHER PAYABLES AND 178,388

ACCRUED EXPENSES

TOTAL LIABILITIES
12,119,537

NET ASSETS $
372,049,375

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
275,635,103

UNDISTRIBUTED NET INVESTMENT INCOME
4,579,952

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
61,740,406

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
30,093,914
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 22,457,910 $
372,049,375
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($372,049,375 (DIVIDED BY) 22,457,910 SHARES) $16.57

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $16.57) $17.08

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 7,704,310
DIVIDENDS

INTEREST 1,313,171

9,017,481

LESS FOREIGN TAXES WITHHELD (984,544)

TOTAL INCOME 8,032,937

EXPENSES

MANAGEMENT FEE $ 2,498,586
BASIC FEE

PERFORMANCE ADJUSTMENT (301,878)

TRANSFER AGENT FEES 891,633

ACCOUNTING FEES AND EXPENSES 251,788

NON-INTERESTED TRUSTEES' COMPENSATION 1,738

CUSTODIAN FEES AND EXPENSES 205,729

REGISTRATION FEES 54,962

AUDIT 38,990

LEGAL 1,715

INTEREST 5,037

REPORTS TO SHAREHOLDERS 47,676

MISCELLANEOUS 1,655

TOTAL EXPENSES BEFORE REDUCTIONS 3,697,631

EXPENSE REDUCTIONS (119,901) 3,577,730

NET INVESTMENT INCOME 4,455,207

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 62,664,224

FOREIGN CURRENCY TRANSACTIONS (64,475) 62,599,749

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 15,666,764

ASSETS AND LIABILITIES IN 12,205 15,678,969
FOREIGN CURRENCIES

NET GAIN (LOSS) 78,278,718

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 82,733,925

OTHER INFORMATION $ 887,094
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 119,838
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 63

$ 119,901

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 4,455,207 $ 2,784,527
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 62,599,749 20,477,130

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 15,678,969 5,045,707

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 82,733,925 28,307,364

DISTRIBUTIONS TO SHAREHOLDERS (2,855,514) (3,490,608)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (16,015,689) -

TOTAL DISTRIBUTIONS (18,871,203) (3,490,608)

SHARE TRANSACTIONS 297,299,863 31,758,801
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 18,146,164 3,381,925

COST OF SHARES REDEEMED (177,761,244) (84,225,438)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 137,684,783 (49,084,712)

REDEMPTION FEES 310,115 26,923

TOTAL INCREASE (DECREASE) IN NET ASSETS 201,857,620 (24,241,033)

NET ASSETS

BEGINNING OF PERIOD 170,191,755 194,432,788

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $4,579,952 AND
$2,652,862, RESPECTIVELY) $ 372,049,375 $ 170,191,755

OTHER INFORMATION
SHARES

SOLD 20,196,556 2,457,375

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,399,089 286,361

REDEEMED (11,229,699) (6,752,442)

NET INCREASE (DECREASE) 10,365,946 (4,008,706)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
YEARS ENDED OCTOBER 31, DECEMBER 21, 1993
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.07 $ 12.08 $ 11.35 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .20 D .22 G .23 .08 D

NET REALIZED AND UNREALIZED GAIN (LOSS) 3.81 2.00 .50 1.27

TOTAL FROM INVESTMENT OPERATIONS 4.01 2.22 .73 1.35

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.23) (.23) - -

FROM NET REALIZED GAIN (1.29) - - -

TOTAL DISTRIBUTIONS (1.52) (.23) - -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .01 - - -

NET ASSET VALUE, END OF PERIOD $ 16.57 $ 14.07 $ 12.08 $ 11.35

TOTAL RETURN B, C 31.57% 18.74% 6.43% 13.50%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 372,049 $ 170,192 $ 194,433 $ 352,855

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.10% 1.33% 1.36% 1.54% A

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.07% E 1.30% E 1.36% 1.54% A

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.33% 1.66% 1.45% .79% A

PORTFOLIO TURNOVER RATE 189% 155% 176% 317% A

AVERAGE COMMISSION RATE F $ .0254 $ .0245

A ANNUALIZED B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD
CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE
NOTE 7 OF NOTES TO FINANCIAL STATEMENTS). C TOTAL RETURNS DO
NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF LESS
THAN ONE YEAR ARE NOT ANNUALIZED. D NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. E FMR OR THE FUND HAS ENTERED INTO VARYING
ARRANGEMENTS WITH THIRD PARTIES WHO EITHER PAID OR REDUCED
A PORTION OF THE FUND'S EXPENSES (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). F FOR FISCAL YEARS BEGINNING ON OR
AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS
AVERAGE COMMISSION RATE PER SHARE FOR SECURITY TRADES ON
WHICH COMMISSIONS
ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND
FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS
MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES
MAY DIFFER. G INVESTMENT INCOME PER SHARE REFLECTS A SPECIAL
DIVIDEND WHICH AMOUNTED TO $.04 PER SHARE.

</TABLE>

FRANCE
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the total returns would have
been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

FRANCE 15.63% 42.09%

FRANCE (INCL. 3% SALES CHARGE) 12.16% 37.83%

SOCI T DES BOURSES FRANAISES 12.83% 34.14%
250 INDEX

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1995. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Socit des Bourses Franaises 250 Index (SBF 250
Index) - a market capitalization weighted index of the stocks of the
250 largest companies in the French market. To measure how the fund's
performance stacked up against its peers, you can compare the fund's
performance to the European region funds average, which reflects the
performance of mutual funds with similar objectives tracked by Lipper
Analytical Services, Inc. The past one year average represents a peer
group of 68 mutual funds. These benchmarks include reinvested
dividends and capital gains, if any, and exclude the effect of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

FRANCE 15.63% 19.20%

FRANCE (INCL. 3% SALES CHARGE) 12.16% 17.40%

SOCIT DES BOURSES FRANAISES 12.83% 15.82%
250 INDEX

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
FRANCE
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Renaud Saleur, Portfolio Manager of Fidelity France
Fund
Q. HOW DID THE FUND PERFORM, RENAUD?
A. For the 12 months that ended on October 31, 1997, the fund returned
15.63%, compared to the 12.83% return of the Societe des Bourses
Francaises (SBF) 250 Index and the European region funds average
return of 20.38%, as monitored by Lipper Analytical Services. The fund
did well, as it outperformed the French stock market. The French
market, however, trailed other European markets over the 12-month
period.
Q. WHAT WERE THE PRINCIPAL FACTORS THAT CONTRIBUTED TO THIS
PERFORMANCE?
A. There were two primary factors that helped performance. First, I
invested in banks and cyclical companies, meaning companies whose
performance tends to rise and fall with the business cycle. Both of
these sectors of the French market were good performers. Growth stocks
- - or stocks of companies expected to have above average earnings
growth - had been the best performing stocks for three years up until
mid-1996. They started to lose steam at the end of 1996 when
financials and cyclicals caught up. Second, the fund had a fair
weighting in large-company stocks, about 60% of the fund.
Large-company stocks tended to have better returns than small-company
stocks in France. However, I would also add that many of the smaller
companies in the fund performed well. The fund's exposure to small
companies did not hurt.
Q. HOW WOULD YOU DESCRIBE THE INVESTMENT ENVIRONMENT DURING THE YEAR?
A. It was a very volatile environment. First, there were political
reasons. We had early elections in May, which turned out to be a
disaster for President Jacques Chirac. This election, in which the
Socialists ascended to power, introduced quite a bit of volatility to
stock performance. Changes in government policy, including higher
taxes for both corporations and individuals, created a new environment
for assessing both the potential profitability of corporations and the
potential behavior of the consumer public. Secondly, because the
French market tends to be relatively less liquid, and investors have
less ability to buy or sell large blocks of stocks without
significantly affecting prices, it tends to exaggerate the movements
seen in other world markets. In the recent crisis in October, which
began with currency devaluations in Asia, the Paris market was hit
harder than the markets of other developed markets, with the exception
of the Far East.
Q. WHAT WAS YOUR INVESTMENT STRATEGY IN THIS ENVIRONMENT?
A. The first part of my strategy was to avoid being significantly
over-exposed to any one industry or sector. I believe that if you have
good stock picking in each sector, you should produce good returns,
whether or not a sector is in favor. The fund, however, was somewhat
overweighted in relation to the French market index in banks and
cyclicals, although this was not a dramatic overweighting. Within each
sector, I established positions in a limited number of stocks. In
banks, for example, I concentrated on two companies, Credit Commercial
France (CCF) and Societe Generale. Both turned out to be very good
performers. The second part of my strategy was to try to protect
performance by buying the convertible bond and selling the stock of a
company whenever I thought it was justified, given the current price
of the convertible bond. Convertible bonds tend to have fairly good
downside protection, and this strategy helped the fund remain
resilient in a downturn. Among the major company investments that
included convertible bonds were Societe Generale and Groupe Danone.
Q. CONSTRUCTION AND REAL ESTATE APPEARED TO BE AN AREA OF EMPHASIS, AT
MORE THAN 13% OF PORTFOLIO HOLDINGS AT THE END OF THE YEAR? WHAT WAS
YOUR STRATEGY IN THIS SECTOR?
A. I tended to invest in special construction companies that owned or
were invested in other types of businesses, such as water
distribution, telephone services and telecommunications. I believed
this helped support the value of the stock, even if construction were
not strong. Among the fund's construction holdings were Groupe GTM,
which is involved in utilities, and Bouygues, whose holdings in
television and telecommunications together were valuable enough to
justify the price of the stock without even considering the value of
its construction operations. Another reason the sector was attractive
was that I believed the construction industry was at a low point, with
significant growth potential when the economy picks up. When this
happens, good performance in the construction sector should follow.
Q. WHAT OTHER COMPANIES HAVE CONTRIBUTED TO PERFORMANCE?
A. Energy stocks did very well for the fund, although their weighting
in the portfolio was neutral compared to the index. Among the
significant contributors were Elf Aquitaine and Total, two major oil
companies, and Bouygues Offshore and Technip, which provide services
to the oil industry. These stocks did well as demand for energy began
increasing.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. The luxury goods area certainly was a disappointment, including
companies such as Christian Dior and Clarins, which were sold before
the end of the fiscal year. They sell a lot of goods in the Far East,
so the Far Eastern financial crisis has decimated these stocks.
However, I think the market has made a fairly harsh judgment on these
companies, especially since luxury goods in the past have been
resilient in financial crises.
Q. WHAT IS YOUR OUTLOOK?
A. The French market seems to be in fairly good shape. Many companies
are discovering the importance of respecting shareholder value. The
major companies in France do not depend on the French economy, and I
can develop an opinion on their stocks without being concerned too
much about the French economy or French politics. In addition,
interest rates are low in France. With very high unemployment and low
inflation, it is not likely that interest rates will go up
significantly. That is good for French companies. All these factors
give me a fairly positive attitude about French companies, provided
they have good fundamentals. In addition, I anticipate an increase in
corporate takeovers in France, both by French and foreign companies.
This should have a favorable impact on stock prices. Another
short-term factor that should support French stock prices is that the
new Socialist government has minimized the privatization program that
was aggressively promoted by the former Conservative government. In
the near term, this will support the prices of stocks already being
publicly traded, as the government will not issue new stock that would
compete for investment dollars.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

RENAUD SALEUR ON THE FRENCH INVESTMENT ENVIRONMENT
IN LIGHT OF THE MAY ELECTIONS AND THE 1999 EUROPEAN
ECONOMIC UNIFICATION:
"Each European country is putting its own policies in place
to enable it to join the European Economic Union. At this
point, France seems to be the country most hurt by deciding
not to devalue its own currency. It chose not to devalue in
both 1992 and 1994. France tried to keep its currency tied to
the German currency, and this has hurt France. Devaluation
could have helped to correct a balance of payment deficit by
making foreign products more costly for the French. At the
same time, French products would have become cheaper for
foreigners. Since we are so close to 1999, there is not enough
time for devaluation to help France to meet the criteria for
joining the Economic Union in 1999. French policy, after the
Socialist victory in the May elections, is to try to protect
the French franc and reduce the deficit by raising taxes.
The former Conservative government had tried to relieve
tax pressure, but the Socialists have reversed this process
totally, raising taxes on both corporations and individuals,
while putting greater emphasis on the role of the public sector.
"The Socialist policies result in taking money from the
public and from companies, and distributing it to civil
servants. I am not sure this is a very effective way to
encourage business and economic expansion and boost the
economy. The present Socialist government is very
ideological, unlike the last Socialist government, which was
more pragmatic. I would expect that it would take the
government a year or more to adjust and become more
pragmatic.
"The French Socialists don't have much time to get ready
for the European Economic Union. France has to be ready
in three years. I think this lack of time limits the range of
decisions the French Socialists can take, and rules out
options that could jeopardize France's entry into the union."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of French issuers.
FUND NUMBER: 345
TRADING SYMBOL: FFRAF
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$5 million
MANAGER: Renaud Saleur, since inception;
portfolio manager and senior equity analyst,
Fidelity International, Limited, since 1986; joined
Fidelity in 1986
(checkmark)
FRANCE
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 5.7%
ROW: 1, COL: 1, VALUE: 94.3
ROW: 1, COL: 2, VALUE: 5.7
FRANCE 94.3%
AS OF APRIL 30, 1997
UNITED STATES 3.4%
ROW: 1, COL: 1, VALUE: 96.59999999999999
ROW: 1, COL: 2, VALUE: 3.4
FRANCE 96.6%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 76.1 89.1

BONDS 18.2 7.5

SHORT-TERM INVESTMENTS 5.7 3.4

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

NATIONALE ELF AQUITAINE 6.2 4.9
(OIL & GAS)

FRANCE TELECOM SA 3.9 0.0
(TELEPHONE SERVICES)

TOTAL SA CLASS B 3.7 4.3
(OIL & GAS)

CREDIT COMMERCIAL DE FRANCE ORD. (BANKS) 3.4 2.4

GALERIES LAFAYETTE SA 3.3 2.3
(GENERAL MERCHANDISE STORES)

RHONE POULENC SA CLASS A 2.7 2.2
(DRUGS & PHARMEUTICALS)

BOUYGUES OFFSHORE SA 2.5 0.9
(CONSTRUCTION)

COMPAGNIE DE SAINT GOBAIN 2.2 1.8
(CONSTRUCTION)

GROUPE GTM 2.1 0.5
(CONSTRUCTION)

L'OREAL CO. ORD. 2.0 0.0
(HOUSEHOLD PRODUCTS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

CONSTRUCTION & REAL ESTATE 13.1 11.0

FINANCE 11.3 14.3

HEALTH 10.0 6.6

ENERGY 9.9 9.2

DURABLES 8.4 8.6

RETAIL & WHOLESALE 6.7 7.2

MEDIA & LEISURE 6.7 7.4

INDUSTRIAL MACHINERY & EQUIPMENT 6.2 5.6

NONDURABLES 5.3 8.8

TECHNOLOGY 5.3 6.5

FRANCE
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 76.1%
SHARES VALUE (NOTE 1)
AEROSPACE & DEFENSE - 2.4%
AEROSPACE & DEFENSE - 1.4%
Industrielle d'Aviation Latecoere SA 600 $ 73,861
DEFENSE ELECTRONICS - 1.0%
Intertechnique SA 260 55,223
TOTAL AEROSPACE & DEFENSE 129,084
BASIC INDUSTRIES - 3.2%
CHEMICALS & PLASTICS - 2.2%
L'Air Liquide 695 107,674
(EPI) Espace Production Internationale SA 850 14,567
122,241
METALS & MINING - 1.0%
Pechiney SA Class A 1,300 53,378
TOTAL BASIC INDUSTRIES 175,619
CONSTRUCTION & REAL ESTATE - 13.1%
BUILDING MATERIALS - 4.0%
IMETAL SA Ord. 600 64,394
Lafarge SA 1,520 94,827
Lapeyre SA 1,000 58,335
217,556
CONSTRUCTION - 7.5%
Bouygues Offshore SA 2,875 136,112
Compagnie de Saint Gobain 817 117,099
Groupe GTM 1,820 113,416
Technip SA 360 38,075
404,702
ENGINEERING - 1.6%
Bouygues 950 88,801
TOTAL CONSTRUCTION & REAL ESTATE 711,059
DURABLES - 8.4%
AUTOS, TIRES, & ACCESSORIES - 2.7%
Bertrand Faure SA 100 5,884
Sylea SA 800 70,626
Valeo SA 1,000 66,592
143,102
CONSUMER DURABLES - 1.7%
l'Europeenne d'Extincteurs 1,022 68,287
Securidev SA 1,200 22,019
90,306
CONSUMER ELECTRONICS - 1.5%
BIC 720 49,180
SEB SA 300 34,222
83,402
TEXTILES & APPAREL - 2.5%
Aigle SA, Class A 600 32,301
Alain Manoukian SA 1,800 57,643
Christian Dior warrants 6/30/98 (a) 2,800 46,869
136,813
TOTAL DURABLES 453,623
ENERGY - 9.9%
OIL & GAS - 9.9%
Nationale Elf Aquitaine 2,705 334,323
Total SA Class B 1,820 201,629
535,952

SHARES VALUE (NOTE 1)
FINANCE - 6.6%
BANKS - 3.4%
Credit Commercial de France Ord. 3,215 $ 181,871
CREDIT & OTHER FINANCE - 3.2%
Axime SA Ex Segin (a) 855 95,165
Compagnie Financiere de Credit
Industriel et Commercial SA 1,100 80,163
175,328
TOTAL FINANCE 357,199
HEALTH - 7.1%
DRUGS & PHARMACEUTICALS - 7.1%
Dollfus Mieg & CIE (DMC) (a) 3,300 63,064
Genset SA (a) 1,200 67,614
Rhone Poulenc SA Class A 3,380 147,149
Synthelabo 905 106,370
384,197
HOLDING COMPANIES - 0.6%
Marine Wendel SA 300 34,482
INDUSTRIAL MACHINERY & EQUIPMENT - 1.1%
Euraltech SA 90 14,037
Sidel SA 800 44,868
58,905
MEDIA & LEISURE - 3.3%
BROADCASTING - 0.8%
NRJ SA 300 41,544
LEISURE DURABLES & TOYS - 1.1%
Skis Rossignol SA 3,100 61,335
PUBLISHING - 1.4%
Hachette Filipacchi Medias SA (a) 400 73,741
TOTAL MEDIA & LEISURE 176,620
NONDURABLES - 3.2%
BEVERAGES - 1.2%
LVMH (Moet-Hennessy Louis Vuitton)
sponsored ADR 385 65,311
HOUSEHOLD PRODUCTS - 2.0%
L'Oreal Co. Ord. 309 109,330
TOTAL NONDURABLES 174,641
RETAIL & WHOLESALE - 6.7%
GENERAL MERCHANDISE STORES - 4.2%
Carrefour Supermarche SA 100 52,104
Galeries Lafayette SA 380 177,602
229,706
RETAIL & WHOLESALE, MISCELLANEOUS - 2.5%
Pinault Printemps SA 218 99,548
Rallye SA 700 33,116
132,664
TOTAL RETAIL & WHOLESALE 362,370
SERVICES - 1.3%
ADVERTISING - 1.3%
Expand SA (a) 600 57,020
Havas SA 220 14,471
71,491
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TECHNOLOGY - 5.3%
COMPUTER SERVICES & SOFTWARE - 1.9%
Cegid SA 600 $ 64,913
Cap Gemini Sogeti SA 500 39,640
104,553
COMPUTERS & OFFICE EQUIPMENT - 1.6%
Compagnie des Machines Bull SA (a) 4,200 45,803
Guilbert 300 39,104
84,907
ELECTRONICS - 1.8%
Schneider SA 1,805 96,234
TOTAL TECHNOLOGY 285,694
UTILITIES - 3.9%
TELEPHONE SERVICES - 3.9%
France Telecom SA 5,542 209,422
TOTAL COMMON STOCKS
(Cost $3,773,143) 4,120,358
CONVERTIBLE BONDS - 18.2%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT (C)
FINANCE - 4.7%
BANKS - 4.7%
Societe Generale
3 1/2%, 1/1/00 Aa3 FRF 1,168,200 251,853
HEALTH - 2.9%
DRUGS & PHARMACEUTICALS - 2.9%
Sanofi SA 4%, 1/1/00 - FRF 471,200 158,395
INDUSTRIAL MACHINERY & EQUIPMENT - 5.1%
ELECTRICAL EQUIPMENT - 2.7%
Alcatel Alsthom CGE SA
6 1/2%, 1/1/00 A1 FRF 680,000 144,194
INDUSTRIAL MACHINERY & EQUIPMENT - 2.4%
Carbone Lorrane, Le
3 1/4%, 1/1/01 - FRF 250,000 133,288
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 277,482
MEDIA & LEISURE - 3.4%
LODGING & GAMING - 3.4%
Accor SA 6 3/4%, 1/1/00 - FRF 734,400 183,273
NONDURABLES - 2.1%
FOODS - 2.1%
Groupe Danone
6.60%, 1/1/00 A1 FRF 513,000 113,468
TOTAL CONVERTIBLE BONDS
(Cost $878,513) 984,471
CASH EQUIVALENTS - 5.7%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $307,328) 307,328 $ 307,328
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $4,958,984) $ 5,412,157
CURRENCY ABBREVIATIONS
FRF - French franc
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Principal amount is stated in United States dollars unless
otherwise noted.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $8,612,169 and $9,329,767, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $601 for the period.
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $4,964,607. Net unrealized appreciation
aggregated $447,550, of which $653,692 related to appreciated
investment securities and $206,142 related to depreciated investment
securities.
The fund hereby designates approximately $284,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
FRANCE
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $ 5,412,157

(COST $4,958,984) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD 173,792

RECEIVABLE FOR FUND SHARES SOLD 1,358

DIVIDENDS RECEIVABLE 44,328

INTEREST RECEIVABLE 897

RECEIVABLE FROM INVESTMENT ADVISER FOR EXPENSE REDUCTIONS 1,932

TOTAL ASSETS 5,634,464

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 5,898

PAYABLE FOR FUND SHARES REDEEMED 14,228

OTHER PAYABLES AND 35,963

ACCRUED EXPENSES

TOTAL LIABILITIES 56,089

NET ASSETS $ 5,578,375

NET ASSETS CONSIST OF:

PAID IN CAPITAL $ 4,368,369

UNDISTRIBUTED NET INVESTMENT INCOME 23,384

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 743,150

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 443,472

AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 420,448 $ 5,578,375

SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($5,578,375 (DIVIDED BY) 420,448 SHARES) $13.27

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $13.27) $13.68

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 157,739
DIVIDENDS

INTEREST 38,821

196,560

LESS FOREIGN TAXES WITHHELD (22,502)

TOTAL INCOME 174,058

EXPENSES

MANAGEMENT FEE $ 46,846

TRANSFER AGENT FEES 22,817

ACCOUNTING FEES AND EXPENSES 60,010

NON-INTERESTED TRUSTEES' COMPENSATION 36

CUSTODIAN FEES AND EXPENSES 45,966

REGISTRATION FEES 16,807

AUDIT 32,236

LEGAL 41

REPORTS TO SHAREHOLDERS 1,169

MISCELLANEOUS 41

TOTAL EXPENSES BEFORE REDUCTIONS 225,969

EXPENSE REDUCTIONS (100,947) 125,022

NET INVESTMENT INCOME 49,036

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 761,976

FOREIGN CURRENCY TRANSACTIONS (9,120) 752,856

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 27,638

ASSETS AND LIABILITIES IN (6,932) 20,706
FOREIGN CURRENCIES

NET GAIN (LOSS) 773,562

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 822,598

OTHER INFORMATION $ 15,163
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 20
CUSTODIAN CREDITS

FMR REIMBURSEMENT 100,927

$ 100,947

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

OPERATIONS $ 49,036 $
94,919
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 752,856
418,467

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 20,706
422,766

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 822,598
936,152

DISTRIBUTIONS TO SHAREHOLDERS (69,894)
(10,687)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (266,472) -

TOTAL DISTRIBUTIONS (336,366)
(10,687)

SHARE TRANSACTIONS 5,243,968
11,366,476
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 334,785
10,618

COST OF SHARES REDEEMED (6,049,684)
(6,790,666)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (470,931)
4,586,428

REDEMPTION FEES 21,293
29,888

TOTAL INCREASE (DECREASE) IN NET ASSETS 36,594
5,541,781

NET ASSETS

BEGINNING OF PERIOD 5,541,781 -

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $23,384 AND $87,666, RESPECTIVELY) $ 5,578,375 $
5,541,781

OTHER INFORMATION

SOLD 411,477
1,041,015

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 28,936 1,052

REDEEMED (472,584)
(589,448)

NET INCREASE (DECREASE) (32,171)
452,619

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.24 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .10 C .23

NET REALIZED AND UNREALIZED GAIN (LOSS) 1.66 1.98

TOTAL FROM INVESTMENT OPERATIONS 1.76 2.21

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.16) (.04)

FROM NET REALIZED GAIN (.61) -

TOTAL DISTRIBUTIONS (.77) (.04)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .04 .07

NET ASSET VALUE, END OF PERIOD $ 13.27 $ 12.24

TOTAL RETURN A, B 15.63% 22.89%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 5,578 $ 5,542

RATIO OF EXPENSES TO AVERAGE NET ASSETS 2.00% D 2.00%
D

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS .78% 1.74%

PORTFOLIO TURNOVER RATE 150% 129%

AVERAGE COMMISSION RATE E $ .1749 $ .1932

</TABLE>

GERMANY
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the total returns would have
been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

GERMANY 20.47% 36.62%

GERMANY (INCL. 3% SALES CHARGE) 16.86% 32.52%

DEUTSCHER AKTIENINDEX 100 21.04% 37.73%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1995. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Deutscher Aktienindex (DAX) 100 - a market
capitalization weighted index of the 100 most heavily traded stocks in
the German market. To measure how the fund's performance stacked up
against its peers, you can compare the fund's performance to the
European region funds average, which reflects the performance of
mutual funds with similar objectives tracked by Lipper Analytical
Services, Inc. The past one year average represents a peer group of 68
mutual funds. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

GERMANY 20.47% 16.86%

GERMANY (INCL. 3% SALES CHARGE) 16.86% 15.12%

DEUTSCHER AKTIENINDEX 100 21.04% 17.36%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
GERMANY
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Alexandra Edzard, Portfolio Manager
of Fidelity Germany Fund
Q. HOW DID THE FUND PERFORM, ALEXANDRA?
A. For the 12-month period that ended October 31, 1997, the fund
returned 20.47%. The fund's benchmark, the Deutscher Aktienindex (DAX)
100, gained 21.04% during the past 12 months. According to Lipper
Analytical Services, the total return for the European region funds
average was 20.38% for the 12-month period.
Q. THE GERMAN STOCK MARKET SHOWED CONSIDERABLE VOLATILITY DURING THE
PERIOD. CAN YOU TALK ABOUT THE FACTORS BEHIND THE MARKET'S
PERFORMANCE?
A. During most of the period, the market was very strong. For example,
it was up as much as 57.6% at its July peak. Several factors accounted
for the market's gains during the first nine months of the period.
First, Germany has an export-oriented economy. Many industries such as
automobiles and engineering that rely on exports benefited from the
strength of the dollar and other currencies versus the Deutsche mark,
because it was easier for the companies to sell their products and
services to foreign customers at cheaper prices. The mark's weakness
also made imported products more expensive to German customers,
helping make the goods and services provided by German companies that
compete against foreign imports more attractive. In addition, many
German companies continued restructuring moves aimed at improving
shareholder value. Finally, there was considerable speculation about
mergers and acquisitions in the financial sector, which helped drive
up share prices. That speculation was fueled in part by a merger
between two Bavarian banks - Bayerische Vereinsbank and Bayerische
Hypobank.
Q. WHAT HAPPENED AFTER THE MARKET PEAKED IN JULY?
A. Share prices fell during the last three months of the period,
partly in response to a weakening dollar. The market decline also
reflected other concerns, including worries about sharp drops in Asian
stock prices.
Q. WHAT DROVE THE FUND'S PERFORMANCE DURING THE YEAR?
A. The fund generally doesn't attempt to outperform the DAX 100 by
investing in broad themes or greatly overweighting and underweighting
various sectors. Instead, I attempt to add value through individual
stock picking, focusing on shares of companies with realistic return
goals and sound strategies for achieving them. During the recent
period, the fund benefited from the performance of individual
holdings, including software maker SAP, a well-managed firm with a
growing client base. Other holdings that performed well for the fund
included Wella, a cosmetics company that has made important
restructuring moves, and Lufthansa, the airline company, which cut
costs and reported strong traffic volume.
Q. DID THE FUND INVEST IN THE EXPORT-ORIENTED COMPANIES THAT YOU
MENTIONED EARLIER?
A. Yes, it did. The fund held shares of automotive stocks such as
Volkswagen and BMW, as well as stocks of engineering companies such as
Mannesmann, Thyssen and Krupp-Hoesch. These firms and their stocks
benefited from strong exports, as well as other factors. For example,
I believed that the merger of Thyssen and Krupp-Hoesch during the
recent period would result in cost savings that would further boost
shareholder returns.
Q. WERE THERE ANY DISAPPOINTMENTS FOR THE FUND?
A. I'd point to disappointments in three areas. First, chemical
companies such as BASF suffered from increasing production capacity,
which drove prices down in that industry. Second, utilities such as
Veba lagged the overall market for two reasons: They don't export, and
hence didn't benefit from the relative weakness of the Deutsche mark,
and their restructuring moves are already complete - so all of the
benefits were previously reflected in their stock prices. Third,
retailers such as Metro also lagged because of the slow pace of
domestic retail sales. All three sectors were underweighted in the
fund at the end of the period, but on balance the fund's investments
in those sectors hurt its relative performance.
Q. WHAT IMPORTANT CHANGES DID YOU MAKE IN THE PORTFOLIO?
A. Most of the changes involved individual companies rather than broad
sectors. I recently increased the fund's investment in Daimler-Benz,
Germany's largest car maker, due to its improved business prospects.
However, I recently became less enamored of Volkswagen, because I felt
the firm's 7 billion Deutsche mark rights issue - which offered
shareholders the right to purchase additional shares at a discount to
the market price - was unjustified and would dilute shareholder value.
Q. THE FUND'S PERFORMANCE IS COMPARED TO THE DAX 100, WHICH IS MADE UP
OF THE LARGEST GERMAN FIRMS. DID YOU ALSO INVEST IN SHARES OF SMALL
COMPANIES?
A. Some 70% of the fund is invested in the DAX 100's 30 largest
stocks, while the other 30% of the fund's assets are in the remaining
70 stocks. Thus, our investment in small companies is relatively
modest. However, the fund did hold shares of relatively small
companies, which offer the potential for above-average growth. These
included Apcoa, which manages parking spaces, and Hugo Boss, which
makes men's clothing.
Q. WHAT'S YOUR OUTLOOK FOR THE COMING YEAR?
A. The market was driven largely by the very strong rise in exports
during the past year. That strength depends upon what happens to the
dollar. If it continues to weaken, then that will be bad news for
exporters in Germany. Meanwhile, domestic consumer demand is likely to
remain relatively weak, as there is little sign of any imminent
decrease in the current 11% unemployment rate. As a result, retailers
and other industries that depend upon domestic consumer spending
aren't likely to rebound. In short, returns in the German market are
likely to be driven by downsizing and other restructuring moves rather
than sales growth. I will continue to focus on shares of companies
that are making the right moves to deliver higher shareholder value
over the long term. At the same time, I'll keep an eye out for other
opportunities. For example, it seems likely that the financial sector
will benefit from continued consolidation over the long term.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

ALEXANDRA EDZARD ON FINDING VALUE IN GERMAN STOCKS:
"The continued weakness of the German economy and
the unpredictability of currency fluctuations that have
supported German exporters make it a challenge to find
exciting stocks in this market now. Above all, success in the
German stock market requires finding individual companies
that can prosper in this less-than-ideal environment.
"I expect restructuring stories to be the main drivers for
the German market going forward. Many German firms are
making significant cost reductions and selling off
unprofitable divisions. Others are participating in mergers
that offer the opportunity to eliminate redundant costs.
Such moves are likely to increase profitability, thus
generating additional value for shareholders.
"A similar restructuring trend has helped drive returns in
the U.S. stock market during the past decade. Likewise,
such moves by German companies could make an enormous
difference in shareholder returns during the coming years -
especially for investors who can identify the companies that
are working most successfully to achieve shareholder value."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of German issuers
FUND NUMBER: 346
TRADING SYMBOL: FGERF
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$12 million
MANAGER: Alexandra Edzard, since 1996;
joined Fidelity in 1994
(checkmark)
GERMANY
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 9.5%
ROW: 1, COL: 1, VALUE: 85.40000000000001
ROW: 1, COL: 2, VALUE: 1.0
ROW: 1, COL: 3, VALUE: 3.5
ROW: 1, COL: 4, VALUE: 9.5
SWITZERLAND 3.5%
OTHER 0.6%
GERMANY 86.4%
AS OF APRIL 30, 1997
UNITED STATES 9.4%
ROW: 1, COL: 1, VALUE: 84.3
ROW: 1, COL: 2, VALUE: 1.5
ROW: 1, COL: 3, VALUE: 4.0
ROW: 1, COL: 4, VALUE: 9.4
SWITZERLAND 4.0%
OTHER 0.8%
GERMANY 85.8%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

COMMON STOCKS 74.2 75.6

PREFERRED STOCKS 16.4 15.2

SHORT-TERM INVESTMENTS 9.4 9.2

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

ALLIANZ AKTIENGESELLSCHAFT 8.5 8.5
HOLDINGS (REG.)
(INSURANCE)

DAIMLER-BENZ AG ORD. 5.4 4.5
(AUTOS, TIRES, & ACCESSORIES)

SIEMENS AG 5.2 3.8
(ELECTRICAL EQUIPMENT)

DEUTSCHE BANK AG 4.7 4.1
(BANKS)

MUNICH REINSURANCE AG (REG.) 4.1 6.5
(INSURANCE)

HOECHST AG ORD. 4.0 3.8
(CHEMICALS & PLASTICS)

SAP (SYSTEME ANWENDUNGEN 3.9 2.8
PRODUKTE) AG
(COMPUTER SERVICES & SOFTWARE)

VOLKSWAGEN AG 3.5 3.4
(AUTOS, TIRES, & ACCESSORIES)

DREDSNER BANK AG ORD. 3.3 2.5
(BANKS)

(BMW) MUENCHEN BAYERISCHE 3.2 2.4
MOTORENWERKE AG
(AUTOS, TIRES, & ACCESSORIES)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 28.9 31.7

DURABLES 16.0 12.1

BASIC INDUSTRIES 13.4 17.0

INDUSTRIAL MACHINERY & EQUIPMENT 9.6 5.8

UTILITIES 8.3 10.4

TECHNOLOGY 7.2 4.6

TRANSPORTATION 2.2 0.5

HEALTH 1.3 4.2

SERVICES 1.1 0.0

HOLDING COMPANIES 0.9 0.6

GERMANY
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 74.2%
SHARES VALUE (NOTE 1)
BASIC INDUSTRIES - 11.3%
CHEMICALS & PLASTICS - 8.8%
BASF AG 6,127 $ 209,209
Bayer AG 8,894 313,481
Hoechst AG Ord. 14,170 541,335
SKW Trostberg AG 3,490 120,380
1,184,405
IRON & STEEL - 2.1%
Thyssen AG Ord. 1,234 286,145
METALS & MINING - 0.4%
Vossloh AG (Reg.) 1,041 52,623
TOTAL BASIC INDUSTRIES 1,523,173
CONSTRUCTION & REAL ESTATE - 0.4%
REAL ESTATE - 0.4%
IVG Holding AG 1,868 52,087
DURABLES - 8.4%
AUTOS, TIRES, & ACCESSORIES - 5.8%
Continental Gummi-Werke AG 2,205 52,984
Daimler-Benz AG Ord. 10,846 728,097
781,081
TEXTILES & APPAREL - 2.6%
Adidas AG 1,778 257,681
Boss (Hugo) AG 68 86,725
344,406
TOTAL DURABLES 1,125,487
FINANCE - 28.1%
BANKS - 14.4%
Bayerische Hypotheken-und
Wechselbank AG 2,563 108,760
Bayerische Vereinsbank AG Ord. 4,327 257,112
BHF Bank (Bank Berlin Hand) 1,315 39,641
Credit Suisse Group (Reg.) 1,775 250,353
Deutsche Bank AG 9,517 625,363
Dresdner Bank AG Ord. 10,821 444,131
Julius Baer Holding AG 145 216,696
1,942,056
INSURANCE - 13.7%
Allianz Aktiengesellschaft Holdings (Reg.) 5,050 1,137,348
Hannover Rueckversicherungs-AG 183 13,653
ING Groep NV 1,902 79,698
Koelnische Ruckesich (Reg.) 61 55,262
Munich Reinsurance AG (Reg.) 1,890 551,113
1,837,074
TOTAL FINANCE 3,779,130
HEALTH - 1.3%
MEDICAL EQUIPMENT & SUPPLIES - 1.3%
Gehe AG 3,273 172,663
HOLDING COMPANIES - 0.9%
Man AG Ord. 383 114,789
INDUSTRIAL MACHINERY & EQUIPMENT - 9.1%
ELECTRICAL EQUIPMENT - 5.3%
Rofin Sinar Technologies, Inc. (a) 1,111 15,415
Siemens AG 11,464 701,796
717,211

SHARES VALUE (NOTE 1)
INDUSTRIAL MACHINERY & EQUIPMENT - 3.8%
Boewe Systec AG 244 $ 7,214
Fried. Krupp AG, Krupp-Hoesch 606 119,092
Mannesmann AG Ord. 892 377,484
503,790
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 1,221,001
RETAIL & WHOLESALE - 0.7%
GENERAL MERCHANDISE STORES - 0.7%
Metro AG 2,097 92,997
SERVICES - 1.1%
LEASING & RENTAL - 1.1%
Apcoa Parking AG 1,763 143,084
TECHNOLOGY - 4.5%
COMPUTER SERVICES & SOFTWARE - 3.9%
SAP (Systeme Anwendungen
Produkte) AG 1,840 528,533
ELECTRONIC INSTRUMENTS - 0.6%
Pfeiffer Vacuum Technology
AG sponsored ADR (a) 2,360 75,930
TOTAL TECHNOLOGY 604,463
TRANSPORTATION - 2.2%
AIR TRANSPORTATION - 2.2%
Lufthansa Deutsche AG (Reg.) 16,359 292,565
UTILITIES - 6.2%
ELECTRIC UTILITY - 4.4%
Veba AG Ord. 7,687 428,912
Viag AG 359 168,990
597,902
TELEPHONE SERVICES - 1.8%
Deutsche Telekom AG 12,456 236,845
TOTAL UTILITIES 834,747
TOTAL COMMON STOCKS
(Cost $9,442,106) 9,956,186
NONCONVERTIBLE PREFERRED STOCKS - 16.4%
BASIC INDUSTRIES - 2.1%
CHEMICALS & PLASTICS - 2.1%
Wella AG 402 281,983
DURABLES - 7.6%
AUTOS, TIRES, & ACCESSORIES - 6.9%
(BMW) Muenchen Bayerische
Motorenwerke AG 851 429,200
Porsche AG (a) 16 23,374
Volkswagen AG 1,034 474,141
926,715
HOME FURNISHINGS - 0.7%
Moebel Walther AG 2,255 91,507
TOTAL DURABLES 1,018,222
FINANCE - 0.8%
INSURANCE - 0.8%
Marschollek Lautenschlaeger
und Partner AG 453 103,730
NONCONVERTIBLE PREFERRED STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
INDUSTRIAL MACHINERY & EQUIPMENT - 0.5%
Rheinmetal Berlin 3,490 $ 61,707
MEDIA & LEISURE - 0.0%
BROADCASTING - 0.0%
Prosieben Media AG (non-vtg.) 120 5,983
NONDURABLES - 0.6%
FOODS - 0.6%
Suedzucker AG 164 82,713
TECHNOLOGY - 2.7%
COMPUTER SERVICES & SOFTWARE - 2.6%
SAP (Systeme Anwendungen
Produkte) AG 1,194 356,297
ELECTRONICS - 0.1%
Sartorius AG 30 7,565
TOTAL TECHNOLOGY 363,862
UTILITIES - 2.1%
ELECTRIC UTILITY - 2.1%
RWE AG 7,749 283,007
TOTAL NONCONVERTIBLE PREFERRED STOCKS
(Cost $2,097,340) 2,201,207
CASH EQUIVALENTS - 9.4%
Taxable Central Cash Fund (b)
(Cost $1,267,770) 1,267,770 1,267,770
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $12,807,216) $ 13,425,163
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $16,284,584 and $13,024,062 , respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $12,760 for the period.
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $12,810,899. Net unrealized appreciation
aggregated $614,264, of which $1,098,862 related to appreciated
investment securities and $484,598 related to depreciated investment
securities.
The fund hereby designates approximately $568,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
GERMANY
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
13,425,163
(COST $12,807,216) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
396,289

RECEIVABLE FOR FUND SHARES SOLD 6,187

DIVIDENDS RECEIVABLE 3,587

INTEREST RECEIVABLE 3,192

REDEMPTION FEES RECEIVABLE 134

TOTAL ASSETS
13,834,552

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 1,005,610

PAYABLE FOR FUND SHARES REDEEMED 49,137

ACCRUED MANAGEMENT FEE 13,389

OTHER PAYABLES AND ACCRUED EXPENSES 34,183

TOTAL LIABILITIES
1,102,319

NET ASSETS $
12,732,233

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
10,427,348

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
1,686,841

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
618,044
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 961,505 $
12,732,233
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($12,732,233 (DIVIDED BY) 961,505 SHARES) $13.24

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $13.24) $13.65

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 190,507
DIVIDENDS

INTEREST 45,839

236,346

LESS FOREIGN TAXES WITHHELD (19,312)

TOTAL INCOME 217,034

EXPENSES

MANAGEMENT FEE $ 88,900

TRANSFER AGENT FEES 39,774

ACCOUNTING FEES AND EXPENSES 60,017

NON-INTERESTED TRUSTEES' COMPENSATION 56

CUSTODIAN FEES AND EXPENSES 30,554

REGISTRATION FEES 18,031

AUDIT 31,537

LEGAL 66

REPORTS TO SHAREHOLDERS 2,195

MISCELLANEOUS 57

TOTAL EXPENSES BEFORE REDUCTIONS 271,187

EXPENSE REDUCTIONS (32,864) 238,323

NET INVESTMENT INCOME (LOSS) (21,289)

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 1,716,309

FOREIGN CURRENCY TRANSACTIONS (3,056) 1,713,253

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 288,454

ASSETS AND LIABILITIES IN 146 288,600
FOREIGN CURRENCIES

NET GAIN (LOSS) 2,001,853

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 1,980,564

OTHER INFORMATION $ 53,819
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 15
CUSTODIAN CREDITS

FMR REIMBURSEMENT 32,849

$ 32,864

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

OPERATIONS $ (21,289) $ 6,560

NET INVESTMENT INCOME (LOSS)

NET REALIZED GAIN (LOSS) 1,713,253 284,909

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 288,600 329,444

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 1,980,564 620,913

DISTRIBUTIONS TO SHAREHOLDERS (5,297) -

FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (248,285) -

TOTAL DISTRIBUTIONS (253,582) -

SHARE TRANSACTIONS 14,817,379 9,994,580

NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 252,687 -

COST OF SHARES REDEEMED (11,309,518)
(3,453,139)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 3,760,548 6,541,441

REDEMPTION FEES 66,433 15,916

TOTAL INCREASE (DECREASE) IN NET ASSETS 5,553,963 7,178,270

NET ASSETS

BEGINNING OF PERIOD 7,178,270 -

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $0 AND $6,207, RESPECTIVELY) $ 12,732,233 $ 7,178,270

OTHER INFORMATION

SOLD 1,166,667 951,953

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 22,362 -

REDEEMED (860,345) (319,132)

NET INCREASE (DECREASE) 328,684 632,821

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.34 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME (LOSS) (.02) C .01

NET REALIZED AND UNREALIZED GAIN 2.21 1.31

TOTAL FROM INVESTMENT OPERATIONS 2.19 1.32

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.01) -

FROM NET REALIZED GAIN (.35) -

TOTAL DISTRIBUTIONS (.36) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .07 .02

NET ASSET VALUE, END OF PERIOD $ 13.24 $ 11.34

TOTAL RETURN A, B 20.47% 13.40%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 12,732 $ 7,178

RATIO OF EXPENSES TO AVERAGE NET ASSETS 2.00% D 2.00% D

RATIO OF NET INVESTMENT INCOME (LOSS) TO AVERAGE NET ASSETS (.18)% .12%

PORTFOLIO TURNOVER RATE 120% 133%

AVERAGE COMMISSION RATE E $ .1517 $ .1714

</TABLE>

HONG KONG AND CHINA
PERFORMANCE: THE BOTTOM LINE

HONG KONG AND CHINA -13.36% 12.48%

HONG KONG AND CHINA -15.96% 9.11%
(INCL. 3% SALES CHARGE)

HANG SENG INDEX -12.53% 15.05%

PACIFIC EX-JAPAN FUNDS AVERAGE -25.68% N/A

HONG KONG AND CHINA -13.36% 6.06%

HONG KONG AND CHINA -15.96% 4.45%
(INCL. 3% SALES CHARGE)

HANG SENG INDEX -12.53% 7.26%

PACIFIC EX-JAPAN FUNDS AVERAGE -25.68% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
HONG KONG AND CHINA
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Joseph Tse, Portfolio Manager of Fidelity Hong Kong
and China Fund
Q. HOW DID THE FUND PERFORM, JOSEPH?
A. The fund's performance was hurt significantly by a correction in
the Hong Kong market in October. For the 12-month period that ended on
October 31, 1997, the fund had a return of -13.36%, compared to a
return of -12.53% for the Hang Seng Index and a return of -25.68% for
the Pacific ex-Japan funds average, as measured by Lipper Analytical
Services. The fund outperformed the Lipper average because the funds
that make up the Pacific ex-Japan category had more invested in the
Southeast Asian markets that performed worse than did the Hong Kong
market during the period.
Q. WHAT LED TO THE SHARP DROP IN THE MARKET IN OCTOBER?
A. The Hong Kong market suffered from the negative influence of market
and currency turmoil in Southeast Asia, including Thailand, Indonesia,
the Philippines, Malaysia and Singapore. Events came to a head when
Taiwan - seen as one of the last strongholds in the region - decided
to voluntarily depreciate its currency. This led to speculation
against the Hong Kong dollar and selling of Hong Kong stocks, which
had enjoyed a remarkable rally for two years. The Hong Kong Monetary
Authority, which had sufficient U.S. dollars to back up the local
currency, resisted devaluation, but it did raise short-term interest
rates substantially to protect the currency. The three-month interbank
rate, or the rate banks charge to lend to each other, rose from less
than 7% to over10%. At the height of the volatility, the overnight
lending rate in Hong Kong actually rose to 300% on one day. While the
Monetary Authority was successful in protecting the currency against
devaluation, the Hong Kong stock market suffered a serious reversal.
High short-term rates effectively cut off mortgage lending, and hit
the important real estate industry particularly hard. Fully half the
loan growth of Hong Kong had been in - and 40% of total loans had been
to - the real estate industry. Bank stocks such as HSBC Holdings and
property developers including Cheung Kong Holdings led the market
decline in October. Both small and large companies were hurt. Adding
to the problems, 1998 earnings-growth estimates for Hong Kong and
Chinese companies were reduced substantially amid forecasts of a
substantial economic slowdown. During the month of October, the Hang
Seng Index declined 29%.
Q. WHAT WERE THE GREATEST DISAPPOINTMENTS?
A. The fund had little emphasis on utility stocks, which outperformed
other stocks during the unexpected market crash in October because
they are seen as defensive at times of volatility. While utilities
account for almost 20% of the market capitalization in the Hang Seng
Index, the fund had only about a 4% weighting in this sector at the
end of September. However, I increased the fund's investments in
utilities in October in response to the changing market conditions. In
addition, several of the fund's construction and real estate holdings
were hit particularly hard in the October correction, contributing to
the fund's underperformance relative to the Hang Seng Index. New World
Development and Henderson Land both declined sharply following an
extended period of outperformance by real estate stocks. Henderson
Land was sold by the fund before October 31.
Q. WHAT WAS THE INVESTMENT ENVIRONMENT LIKE DURING THE FIRST 11 MONTHS
OF THE FISCAL YEAR?
A. The market performed very well through September. It was a period
of great optimism. The smooth, uneventful changeover of control of
Hong Kong from Britain to China had encouraged investors, many of whom
believed Hong Kong stocks deserved higher price/earnings multiples
after the uncertainty of the transition had been removed. It was an
environment of relatively stable interest rates and healthy growth,
particularly in the important property-development industry. The
stocks of many so-called "red chip" companies - or companies based in
Hong Kong but controlled in China - had performed exceptionally well.
Before October, concerns about the economies and currencies of other
Southeast Asian countries actually had helped the Hong Kong market, as
investors overweighted Hong Kong by shifting their money here from
other Southeast Asian markets. The Hang Seng Index's largest
component, HSBC Holdings, had appreciated more than 80% in the
11-month period.
Q. DID THE FUND HAVE DIRECT INVESTMENTS IN CHINA?
A. I prefer to invest in China through Hong Kong-based and -controlled
companies, as they tend to be more accustomed to competition, have
stronger managements, more open financial disclosure policies and
better track records of earnings growth. In general, I have avoided
"red chip" stocks. Less than 3% of the portfolio is invested directly
in China, although a number of Hong Kong-based companies in the
portfolio have Chinese operations. Among China-related companies, I am
very selective, and only a very few companies meet my stock- selection
criteria. One example was Zhenhai Refining & Chemical Company, a
petroleum product company. Another example of a China-based company
that the fund has purchased is China Telecom, which was trading at a
relatively attractive price, compared to other "red chip" companies.
Q. WHAT IS YOUR OUTLOOK?
A. The October decline was prompted by currency traders speculating
against the Hong Kong dollar and by the resulting increase in interest
rates to protect the currency. In the short term, investors in Hong
Kong and Chinese companies face unusually high uncertainty because of
the difficulty in projecting sales revenues and profit margins. I
believe the medium-term implications are somewhat broader, however.
With the October decline, we've seen a decline in the optimism over
the region's earnings. I believe this signals a near- to mid-term
slowdown in the tremendous earnings growth and market appreciation we
have seen over the past two years. At the end of the period, we
already were seeing slow sales volumes and higher pressure on pricing
and profit margins among property developers, banks, hotels, retail
companies and most other businesses in Hong Kong.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

JOSEPH TSE ON THE FINANCE AND REAL ESTATE SECTORS IN
HONG KONG AND CHINA:
"The stocks of financial firms were hard hit by the
speculative attack on the Hong Kong dollar and the
resulting increase in short-term interest rates. Higher
interest rates mean lower profits for banks and other
finance-related companies, so their short-term outlook is
poor. Over the medium- to long-term, however, I believe that
economic growth in China and Hong Kong will continue,
supporting a strong finance sector. Real estate, which also
represents a large component of the economy and of the
Hang Seng Index, poses a complicated situation. Property
development stocks, dominated by four major companies,
had driven the market's strong performance. Residential
property prices in Hong Kong have appreciated an average
of about 20% per year for the past 10 years, and the four
major development companies have been extremely
successful as a result. They have had a combined market
share of about 80% and profit margins of 50% to 60%, largely
driven by the appreciating value of their land. The new
government in Hong Kong, however, has taken the initiative
to increase substantially the supply of housing. I believe this
initiative to increase supply to meet the demand for housing
most likely will result in slower appreciation of land values
and thus a more normal range of profit margins, perhaps
from 20% to 25%. However, I believed that
property-development stocks were very attractively priced at
the end of the period, based on their net asset values. I
believe there will continue to be investment opportunities in
this sector, but I am less optimistic and more cautious
than I was before. At the end of the period, the fund was
underweighted in property-related stocks compared to the
Hang Seng Index, although construction and real estate
stocks still comprised about 26% of fund investments. I
expect real estate will continue to be a significant portion of
the fund's portfolio.
"On the whole, I believe the currency and interest-rate
volatility facing the region at the end of the fiscal period
will stabilize over the coming months, barring unforeseen
developments on the world scene. Hong Kong's market
should stabilize earlier relative to the other Southeast Asian
markets, given Hong Kong's stronger basic financial health,
as indicated by the strength of currency and the health and
maturity of Hong Kong's financial and business institutions.
Hong Kong continues to have a very prudent banking
system - one of the most conservative in the world. After
stabilization returns, I feel that strong economic growth in
Hong Kong and China will continue to drive the Hong Kong
market and make it attractive to investors relative to other
Southeast Asian countries and many other international
markets. However, I believe the tremendous optimism that
pervaded the Hong Kong market because of the changeover
of control to China will not return soon. I think the days of
30%-per-year market appreciation are likely behind us."

FUND FACTS
GOAL: Long-term growth of capital by investing
mainly in equity securities of Hong Kong and
Chinese issuers
FUND NUMBER: 352
TRADING SYMBOL: FHKCX
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$177 million
MANAGER: Joseph Tse, since inception; director
of research, Fidelity Investments Management
(Hong Kong), since 1994; manager, Asian
portion of various global equity funds, since
1993; analyst covering Hong Kong and
Chinese equities, 1990-1993; joined Fidelity
in 1990
(checkmark)
HONG KONG AND CHINA
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 8.6%
OTHER 1.0%
ROW: 1, COL: 1, VALUE: 8.6
ROW: 1, COL: 2, VALUE: 72.0
ROW: 1, COL: 3, VALUE: 18.4
ROW: 1, COL: 4, VALUE: 1.0
UNITED KINGDOM 18.4%
HONG KONG 72.0%
AS OF APRIL 30, 1997
OTHER 1.1%
BERMUDA 4.9%
ROW: 1, COL: 1, VALUE: 2.0
ROW: 1, COL: 2, VALUE: 94.0
ROW: 1, COL: 3, VALUE: 4.0
HONG KONG 94.0%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 91.4 100.0

SHORT-TERM INVESTMENTS 8.6 0.0

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

HSBC HOLDINGS PLC 18.4 20.8
(BANKS)

HUTCHISON WHAMPOA LTD. ORD. 10.3 4.3
(ELECTRICAL EQUIPMENT)

CHEUNG KONG HOLDINGS LTD. 8.7 7.7
(REAL ESTATE)

SUN HUNG KAI PROPERTIES LTD. 7.9 10.2
(REAL ESTATE)

NEW WORLD DEVELOPMENT CO. LTD. 4.3 5.4
(REAL ESTATE)

CHINA TELECOM (HONG KONG) LTD. 3.4 0.0
(CELLULAR)

HONG KONG TELECOMMUNICATIONS LTD. 3.2 5.5
(TELEPHONE SERVICES)

NATIONAL MUTUAL ASIA LTD. 2.9 0.4
(INSURANCE)

CITIC PACIFIC LTD. ORD. 2.6 4.8
(HOLDING COMPANIES)

SMARTONE TELECOMMUNICATIONS 2.3 1.9
HOLDINGS LTD.
(CELLULAR)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 27.0 24.9

CONSTRUCTION & REAL ESTATE 25.5 36.9

UTILITIES 14.4 14.9

INDUSTRIAL MACHINERY & EQUIPMENT 12.1 4.8

HOLDING COMPANIES 3.6 6.8

DURABLES 1.6 0.6

HEALTH 1.6 0.4

TRANSPORTATION 1.5 3.8

MEDIA & LEISURE 1.2 3.8

RETAIL & WHOLESALE 1.1 1.4

HONG KONG AND CHINA
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 91.4%
SHARES VALUE (NOTE 1)
CONSTRUCTION & REAL ESTATE - 25.5%
BUILDING MATERIALS - 0.1%
Shanghai Shangling Electric Appliances
Class B (a) 466,000 $ 87,611
CONSTRUCTION - 0.8%
Cheung Kong Infrastructure Holdings Ltd. 568,000 1,469,599
REAL ESTATE - 24.6%
Cheung Kong Holdings Ltd. 2,249,000 15,638,260
Henderson China Holding Ltd. 1,104,000 1,185,408
Henderson Investment Ltd. 2,140,000 1,578,008
Hong Kong Land Holdings Ltd. 308,000 702,240
HKR International Ltd. 1,866,400 1,231,389
Kerry Properties Ltd. 604,000 1,250,194
Lippo China Resources Ltd. 1,828,000 478,875
New World Development Co. Ltd. 2,204,005 7,755,360
Soundwill Holdings Ltd.
warrants 6/26/99 (a) 518,400 41,579
Sun Hung Kai Properties Ltd. 1,913,000 14,106,209
43,967,522
TOTAL CONSTRUCTION & REAL ESTATE 45,524,732
DURABLES - 1.6%
TEXTILES & APPAREL - 1.6%
Glorious Sun Enterprises 9,914,000 2,565,071
Texwinca Holdings Ltd. 1,152,000 372,574
2,937,645
ENERGY - 0.8%
OIL & GAS - 0.8%
Zhenhai Refining & Chemical Co.,
Class H 3,016,000 1,404,605
FINANCE - 27.0%
BANKS - 23.9%
HSBC Holdings PLC 1,406,676 32,957,012
Hang Seng Bank Ltd. 352,000 3,062,354
Ka Wah Bank Ltd. 694,000 1,010,026
Liu Chong Hing Bank Ltd. (a) 2,211,000 2,917,490
Union Bank of Hong Kong 898,000 1,126,856
Wing Hang Bank Ltd. 130,000 334,670
Wing Lung Bank 308,000 1,314,877
42,723,285
CREDIT & OTHER FINANCE - 0.2%
JCG Holdings Ltd. 940,000 416,494
INSURANCE - 2.9%
National Mutual Asia Ltd. 5,574,000 5,047,606
TOTAL FINANCE 48,187,385
HEALTH - 1.6%
MEDICAL EQUIPMENT & SUPPLIES - 1.6%
Arts Optical International Holdings Ltd. 282,000 35,752
Moulin International Holding Ltd. 11,506,000 1,265,214
Moulin International Holding Ltd.
warrants 10/16/99 (a) 1,166,666 25,507
Sa Sa International Holdings Ltd. 8,842,000 1,578,520
2,904,993
HOLDING COMPANIES - 3.6%
Citic Pacific Ltd. Ord. 988,000 4,729,107
Jardine Matheson Holdings Ltd. Ord. 272,000 1,740,800
6,469,907

SHARES VALUE (NOTE 1)
INDUSTRIAL MACHINERY & EQUIPMENT - 12.1%
ELECTRICAL EQUIPMENT - 12.1%
Harbin Power Equipment Co. Ltd.
Class H 786,000 $ 150,489
Hutchison Whampoa Ltd. Ord. 2,668,000 18,465,459
Johnson Electric Holdings Ltd. 773,040 2,110,109
Mei Ah International (a) 11,180,000 124,383
QPL International Ltd. Ord. 1,328,000 824,631
21,675,071
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
Dongfang Electrical Machinery Co. Ltd.
Class H 126,000 28,525
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 21,703,596
MEDIA & LEISURE - 1.2%
BROADCASTING - 0.5%
Asia Satellite Telecommunications
Holdings Ltd. 14,000 33,687
Television Broadcast Ltd. Ord. 278,000 773,221
806,908
PUBLISHING - 0.7%
South China Morning Post Holdings 1,516,000 1,313,997
TOTAL MEDIA & LEISURE 2,120,905
RETAIL & WHOLESALE - 1.1%
APPAREL STORES - 1.1%
Giordano Holdings Ltd. Ord. 5,225,000 1,926,423
TECHNOLOGY - 1.0%
COMPUTER SERVICES & SOFTWARE - 0.4%
Founder Hong Kong Ltd. 780,000 615,524
Vanda Systems & Communications
Holdings Ltd. 348,000 150,815
766,339
COMPUTERS & OFFICE EQUIPMENT - 0.6%
Legend Holdings Ltd. (a) 2,802,000 951,520
Semi-Tech Global Ltd.
warrants 7/31/98 (a) 68,600 1,491
953,011
TOTAL TECHNOLOGY 1,719,350
TRANSPORTATION - 1.5%
AIR TRANSPORTATION - 1.5%
Swire Pacific Ltd. Class A 508,000 2,714,153
TRUCKING & FREIGHT - 0.0%
GZI Transport Ltd. warrants 1/29/99 (a) 62,800 1,706
TOTAL TRANSPORTATION 2,715,859
UTILITIES - 14.4%
CELLULAR - 5.7%
China Telecom (Hong Kong) Ltd. (a) 3,754,000 5,997,658
Smartone Telecommunications
Holdings Ltd. 1,858,000 4,086,158
10,083,816
ELECTRIC UTILITY - 3.4%
China Light & Power Co. Ltd. 732,000 3,854,127
Hong Kong Electric Holdings Ord. 651,000 2,206,494
Shandong Huaneng Power Development
Ltd. Class N sponsored ADR 9,100 67,681
6,128,302
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
UTILITIES - CONTINUED
GAS - 2.1%
Hong Kong & China Gas Co. Ltd. 2,014,000 $ 3,803,933
TELEPHONE SERVICES - 3.2%
Hong Kong Telecommunications Ltd. 2,977,332 5,712,757
TOTAL UTILITIES 25,728,808
TOTAL COMMON STOCKS
(Cost $197,413,597) 163,344,208
CASH EQUIVALENTS - 8.6%
Taxable Central Cash Fund (b)
(Cost $15,436,106) 15,436,106 15,436,106
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $212,849,703) $ 178,780,314
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $450,766,237 and $351,490,709, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $710 for the period.
The fund participated in the bank borrowing program. The maximum loan
and average daily balance during the period for which the loan was
outstanding amounted to $2,260,000. The weighted average interest rate
was 5.88%. Interest expense includes $369 paid under the bank
borrowing program (see Note 6 of Notes to Financial Statements).
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $213,900,057. Net unrealized depreciation
aggregated $35,119,743, of which $8,350,465 related to appreciated
investment securities and $43,470,208 related to depreciated
investment securities.
The fund hereby designates approximately $3,773,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
HONG KONG AND CHINA
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
178,780,314
(COST $212,849,703) - SEE ACCOMPANYING SCHEDULE

CASH 28,531

RECEIVABLE FOR INVESTMENTS SOLD
5,770,902

RECEIVABLE FOR FUND SHARES SOLD
2,517,481

DIVIDENDS RECEIVABLE 98,582

INTEREST RECEIVABLE 19,944

REDEMPTION FEES RECEIVABLE 5,443

TOTAL ASSETS
187,221,197

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 5,060,402

PAYABLE FOR FUND SHARES REDEEMED 4,433,893

ACCRUED MANAGEMENT FEE 134,169

OTHER PAYABLES AND ACCRUED EXPENSES 176,722

TOTAL LIABILITIES
9,805,186

NET ASSETS $
177,416,011

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
206,308,919

UNDISTRIBUTED NET INVESTMENT INCOME
2,038,914

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
3,137,459

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(34,069,281)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 16,040,432 $
177,416,011
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($177,416,011 (DIVIDED BY) 16,040,432 SHARES) $11.06

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $11.06) $11.40

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 4,896,622
DIVIDENDS

INTEREST 502,944

TOTAL INCOME 5,399,566

EXPENSES

MANAGEMENT FEE $ 1,625,465

TRANSFER AGENT FEES 689,505

ACCOUNTING FEES AND EXPENSES 164,562

NON-INTERESTED TRUSTEES' COMPENSATION 919

CUSTODIAN FEES AND EXPENSES 206,284

REGISTRATION FEES 82,001

AUDIT 36,757

LEGAL 1,104

INTEREST 369

REPORTS TO SHAREHOLDERS 34,963

MISCELLANEOUS 811

TOTAL EXPENSES BEFORE REDUCTIONS 2,842,740

EXPENSE REDUCTIONS (371) 2,842,369

NET INVESTMENT INCOME 2,557,197

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 3,356,156

FOREIGN CURRENCY TRANSACTIONS (673) 3,355,483

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES (45,265,917)

ASSETS AND LIABILITIES IN 114 (45,265,803)
FOREIGN CURRENCIES

NET GAIN (LOSS) (41,910,320)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (39,353,123)

OTHER INFORMATION $ 1,509,043
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 371
CUSTODIAN CREDITS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 2,557,197 $ 1,483,683
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 3,355,483 976,500

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) (45,265,803) 11,196,522

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (39,353,123) 13,656,705

DISTRIBUTIONS TO SHAREHOLDERS (1,741,904) (11,297)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (995,341) -

TOTAL DISTRIBUTIONS (2,737,245) (11,297)

SHARE TRANSACTIONS 371,658,055 148,300,504
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 2,718,651 11,187

COST OF SHARES REDEEMED (266,116,227) (52,326,724)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 108,260,479 95,984,967

REDEMPTION FEES 1,365,678 249,847

TOTAL INCREASE (DECREASE) IN NET ASSETS 67,535,789 109,880,222

NET ASSETS

BEGINNING OF PERIOD 109,880,222 -

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $2,038,914 AND $1,471,740,
RESPECTIVELY) $ 177,416,011 $ 109,880,222

OTHER INFORMATION
SHARES

SOLD 26,276,084 13,096,572

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 197,576 1,110

REDEEMED (18,903,843) (4,627,067)

NET INCREASE (DECREASE) 7,569,817 8,470,615

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.97 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME B .17 .29

NET REALIZED AND UNREALIZED GAIN (LOSS) (1.95) 2.64

TOTAL FROM INVESTMENT OPERATIONS (1.78) 2.93

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.14) (.01)

FROM NET REALIZED GAIN (.08) -

TOTAL DISTRIBUTIONS (.22) (.01)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .09 .05

NET ASSET VALUE, END OF PERIOD $ 11.06 $ 12.97

TOTAL RETURN A (13.36)% 29.83%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 177,416 $ 109,880

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.31% 1.62%

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.18% 2.53%

PORTFOLIO TURNOVER RATE 174% 118%

AVERAGE COMMISSION RATE C $ .0034 $ .0049

A TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE. B NET
INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING DURING THE PERIOD. C A FUND IS REQUIRED
TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY
FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF
TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING PRACTICES AND
COMMISSION RATE STRUCTURES MAY DIFFER.

</TABLE>

JAPAN
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

JAPAN -4.89% 19.95% 18.04%

JAPAN (INCL. 3% SALES CHARGE) -7.74% 16.36% 14.49%

TOKYO STOCK EXCHANGE INDEX -21.48% 6.44% -0.63%

JAPANESE FUNDS AVERAGE -10.54% 9.06% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on September 15, 1992. For example, if you had
invested $1,000 in a fund that had a 5% return over the past year, the
value of your investment would be $1,050. You can compare the fund's
returns to the performance of the Tokyo Stock Exchange Index (TOPIX) -
a market capitalization weighted index of over 1,100 stocks traded in
the Japanese market. To measure how the fund's performance stacked up
against its peers, you can compare it to the Japanese funds average,
which reflects the performance of mutual funds with similar objectives
- - in this case, a very small peer group - tracked by Lipper Analytical
Services, Inc. The past one year average represents a peer group of 31
mutual funds. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 LIFE OF
OCTOBER 31, 1997 YEAR YEARS FUND

JAPAN -4.89% 3.71% 3.29%

JAPAN (INCL. 3% SALES CHARGE) -7.74% 3.08% 2.67%

TOKYO STOCK EXCHANGE INDEX -21.48% 1.26% -0.12%

JAPANESE FUNDS AVERAGE -10.54% 1.53% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
JAPAN
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Shigeki Makino, Portfolio Manager of Fidelity Japan
Fund
Q. HOW DID THE FUND PERFORM, SHIGEKI?
A. For the 12 months that ended October 31, 1997, the fund was down
4.89%. In comparison, the Tokyo Stock Exchange Index (TOPIX) - a
measure of the overall performance of the Japanese stock market - lost
21.48%, while the Japanese funds average declined 10.54%, according to
Lipper Analytical Services.
Q. WHY WAS THE FUND ABLE TO OUTPERFORM THE INDEX AND THE AVERAGE OVER
THE PERIOD?
A. Stock-picking was the main reason. I tried to concentrate on the
so-called "nifty" Japanese blue chips - stocks like Honda, Toyota,
Sony, and Canon. These stocks were attractive because they offer
higher returns on capital and higher profit margins, are globally
competitive and have reasonable valuations. The continued weakness of
the yen was also a factor. Many of the stocks that did well for the
fund derive a large percentage of their revenues from exporting. When
the yen weakens relative to those companies' export partners,
yen-denominated sales rise even when the number of units sold remains
static.
Q. ALTHOUGH THE FUND DID WELL RELATIVE TO YOUR EXTERNAL BENCHMARKS, IT
STILL HAD A NEGATIVE RETURN. WHY IS THAT?
A. There are two parts to that story: what's going on outside of Japan
and what's happening within the country. By now, most investors are
probably aware of the sharp declines in equity prices worldwide
triggered by Hong Kong stocks in October. That's actually just the
latest chapter in a continuing saga. In July, after unsuccessful and
extremely costly attempts to prop up their currency, monetary
authorities in Thailand allowed the baht to "float" or trade freely on
world markets. In quick succession, Thailand's currency depreciated
sharply, the Philippine peso also was floated, and the peso, the
Indonesian rupiah and the Malaysian ringgit, which was already
floating, all came under increasing pressure and depreciated by large
amounts. All of this began to put pressure on the Hong Kong dollar in
September and especially October, as increasing skepticism about Hong
Kong's ability to maintain the strength of its currency began to drive
up interest rates there. Such widespread instability is not beneficial
for equity investments, and Japanese equities suffered along with
those of other Pacific Basin countries.
Q. WHAT ABOUT JAPAN ITSELF? WHAT'S HAPPENING INTERNALLY?
A. In Japan, we have a painfully slow economy that is also undergoing
a major transition from regulation to deregulation. On the one hand,
this is creating many attractive investment opportunities. For
example, Japan is abolishing the "convoy system," which requires
profitable companies to provide financial assistance to ailing firms.
This system led to what observers dubbed "reversion to the mean" in
stock prices, as many companies would alternately do well, then
performance would slip as they were required to divert resources to
less capable companies. In a deregulated economy, good companies will
be free to perform up to their full potential. The downside is that
deregulation has hit the financial sector particularly hard. Stocks in
that sector were selling at high valuations, with an implicit
guarantee that banks and finance companies would not fail. That
illusion was destroyed by several noteworthy bankruptcies and numerous
scandals. In addition, banks had substantial assets invested in the
equity markets, which went down during the period.
Q. WHAT STOCKS DID WELL FOR THE FUND?
A. Orix Corp. was one of the fund's best performers. The company
provides leasing and rental services for small and mid-sized companies
worldwide. There were several factors at work behind this company's
performance over the period. The ongoing deregulation of the Japanese
financial industry allowed Orix to finance its leasing activities at
lower rates by issuing medium-term bonds and commercial paper instead
of borrowing from banks. In addition, Japanese interest rates fell,
further cutting the company's borrowing costs. Furthermore, unlike
many Japanese companies, Orix has been very aggressive in dealing with
its bad loans. Finally, the company has become very
shareholder-friendly and has publicly committed itself to improving
return on capital in the future. Since the stock had been virtually
ignored by the Japanese investment community, it had a modest
valuation and lots of upside potential.
Q. WHAT OTHER STOCKS DID WELL DURING THE PERIOD?
A. Another strong performer was Takeda Chemical, which is the premier
pharmaceutical firm in Japan. The stock's strength was based both on
strong current business prospects and bright prospects for the future.
Current fundamentals have improved due to a broad-based cost-cutting
program that has enabled the company to increase sales without
increasing operating costs. Consequently, the company has enjoyed
higher profit margins and profitability. In addition, the company's
research and development activities have resulted in a strong pipeline
of products for the next three or four years. These factors, together
with a low valuation relative to U.S. and European drug companies,
made Takeda Chemical an attractive purchase. Toyota is another company
whose stock was helped by cost-cutting. The company has been extremely
aggressive in cutting costs to the tune of $1 billion per year.
Furthermore, the company was about to enter what was expected to be a
good new product cycle. Finally, Toyota was helped by a weaker yen by
virtue of the fact that a large percentage of its revenues comes from
exporting.
Q. WHAT STOCKS WERE DISAPPOINTMENTS?
A. As I mentioned previously, the Japanese financial services sector
as a whole did poorly. Some widely publicized failures of companies in
this sector caused investors to be wary of good companies along with
bad ones. In addition, valuations were fairly high. The general credit
problems in Asia also made people less willing to invest in financial
services companies. Some examples of stocks that hurt the fund's
performance are Long Term Credit Bank of Japan and Sakura Bank. As a
result of these problems, the fund sharply reduced its holdings of
banks and sought out financial services companies with growing assets
and more transparent operations.
Q. WHAT'S YOUR OUTLOOK, SHIGEKI?
A. Earlier in the year I thought that the Japanese economy might be
about to turn the corner to higher growth. However, growth has
continued to stagnate at extremely low levels, and some economic
indicators have turned down again. The situation has been exacerbated
by tax hikes, the retraction of a tax cut, increased medical costs, a
less robust wage environment and the continuing battle with
bankruptcies and deregulation in several major industries. Now most of
Asia appears to be headed for a general slowdown. Until some of these
things work themselves out, I will have to be extremely selective in
my stock picking. The fund will continue to try to identify companies
with shareholder-friendly managements that show an interest in
providing a solid return on investment. Deregulation should open the
door for more of these companies to distinguish themselves in the
months and years to come.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

SHIGEKI MAKINO ON JAPAN'S CONNECTIONS WITH
OTHER PACIFIC BASIN ECONOMIES:
"The Japanese banking sector has substantial exposure to
the rest of Asia, with roughly $37 billion invested in Thailand
and another $24 billion in South Korea. The saving grace is
that about half of that exposure is to Japanese affiliates and
multinationals doing business in those countries. Most of
those companies would not default because of an internal
currency depreciation and, in fact, many would even benefit
in that kind of environment. The other half of the exposure
is to government entities and large corporations. Therefore,
problems in these economies would certainly have some
negative ripple effect on the Japanese companies with
investments there, but it would not be nearly so calamitous
as, for example, a general collapse in Japanese equity prices.
"Certainly another aspect to consider is the effect of the
Pacific Basin on Japanese exports. Asia is a big production
base for Japan; much of what is exported from Japan to Asia
is then sold in the United States and Europe. That demand
should remain relatively strong. But in areas such as
consumer nondurables and machinery, Asia is the primary
end user of Japanese products. A slowdown in consumer
demand in Asia - whether because of weaker currencies
or a general economic slowdown - would negatively affect
Japanese exports in those industries.
"Further, the effects of currency depreciation in other
Pacific Basin countries would surely be felt in any Japanese
industry that deals in a global commodity like paper, steel
or chemicals. There is a lot of excess production capacity
in Asia, and weaker currencies mean cheaper exports with
which Japanese companies in those industries would have
to compete. In such an environment, Japanese companies
would have to cut prices, and their profit margins would
suffer as a result.
"Finally, one might wonder if Japan will respond to the general
weakening of its neighbors' currencies by investing more
there, which would be a strengthening influence on those
currencies. Given the considerable amounts Japanese
companies have already invested in Asia in the past five
years, however, I think the answer is probably no."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of Japanese issuers
FUND NUMBER: 350
TRADING SYMBOL: FJAPX
START DATE: September 15, 1992
SIZE: as of October 31, 1997, more than
$255 million
MANAGER: Shigeki Makino, since 1994;
manager, Fidelity Pacific Basin Fund, since
1996; analyst, Fidelity Japan Fund,
1993-1994; joined Fidelity in 1990
(checkmark)
JAPAN
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 5.2%
OTHER 0.1%
ROW: 1, COL: 1, VALUE: 5.2
ROW: 1, COL: 2, VALUE: 1.5
ROW: 1, COL: 3, VALUE: 93.2
JAPAN 94.7%
AS OF APRIL 30, 1997
UNITED STATES 6.8%
OTHER 1.9%
ROW: 1, COL: 1, VALUE: 6.8
ROW: 1, COL: 2, VALUE: 2.2
ROW: 1, COL: 3, VALUE: 91.0
JAPAN 91.3%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 94.8 91.6

BONDS 0.0 1.6

SHORT-TERM INVESTMENTS 5.2 6.8

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

MATSUSHITA ELECTRIC INDUSTRIAL CO. LTD. 3.3 2.8
(CONSUMER ELECTRONICS)

TOYOTA MOTOR CORP. 2.9 5.4
(AUTOS, TIRES, & ACCESSORIES)

HONDA MOTOR CO. LTD. 2.5 1.5
(AUTOS, TIRES, & ACCESSORIES)

CANON, INC. 2.5 3.3
(COMPUTERS & OFFICE EQUIPMENT)

ACOM CO. LTD. 2.4 1.2
(CREDIT & OTHER FINANCE)

OMRON CORP. 2.3 1.7
(ELECTRICAL EQUIPMENT)

ROHM CO. LTD. 2.3 1.0
(ELECTRONICS)

TAKEDA CHEMICAL INDUSTRIES LTD. 2.2 2.0
(DRUGS & PHARMACEUTICALS)

ORIX CORP. 2.1 1.7
(LEASING & RENTAL)

SONY CORP. 2.1 2.2
(CONSUMER ELECTRONICS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

TECHNOLOGY 25.3 19.0

FINANCE 15.8 14.9

DURABLES 13.9 15.8

INDUSTRIAL MACHINERY & EQUIPMENT 10.3 10.0

HEALTH 9.1 6.5

MEDIA & LEISURE 4.9 4.7

SERVICES 4.5 3.5

BASIC INDUSTRIES 2.9 7.2

RETAIL & WHOLESALE 2.4 4.7

NONDURABLES 2.4 2.2

JAPAN
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 94.8%
SHARES VALUE (NOTE 1)
BASIC INDUSTRIES - 2.9%
CHEMICALS & PLASTICS - 2.1%
Mitsui Chemicals, Inc. (a) 301,200 $ 1,000,659
Shin-Etsu Chemical Co. Ltd. 140,000 3,418,605
Tenma Corp. 70,000 918,605
5,337,869
IRON & STEEL - 0.8%
Sumitomo Metal Industries Ltd. 1,000,000 2,001,661
TOTAL BASIC INDUSTRIES 7,339,530
CONSTRUCTION & REAL ESTATE - 1.3%
BUILDING MATERIALS - 0.0%
C.I. Holdings BHD 85,000 170,000
CONSTRUCTION - 0.7%
Daiwa House Industry Co. Ltd. 100,000 963,455
Okumura Gumi (a) 160,000 757,475
1,720,930
REAL ESTATE - 0.6%
Mitsubishi Estate Co. Ltd. 100,000 1,262,459
Sumitomo Realty & Development Co. Ltd. 44,000 321,229
1,583,688
TOTAL CONSTRUCTION & REAL ESTATE 3,474,618
DURABLES - 13.9%
AUTOS, TIRES, & ACCESSORIES - 6.2%
Denso Corp. 85,000 1,835,548
Honda Motor Co. Ltd. 190,000 6,391,196
Toyota Motor Corp. 270,000 7,512,459
15,739,203
CONSUMER DURABLES - 1.8%
Aderans Co. Ltd. 72,000 1,937,542
Heiwa Corp. 85,000 1,426,080
Sankyo Co. Ltd. 55,000 1,174,003
4,537,625
CONSUMER ELECTRONICS - 5.9%
Citizen Watch Co. Ltd. Ord. 220,000 1,403,322
Matsushita Electric Industrial Co. Ltd. 500,000 8,388,705
Sony Corp. 64,700 5,368,381
15,160,408
TOTAL DURABLES 35,437,236
FINANCE - 15.8%
BANKS - 6.6%
Akita Bank Ltd. 300,000 1,681,894
Bank of Tokyo-Mitsubishi Ltd. 225,000 2,933,970
Fuji Bank Ltd. 360,000 3,109,635
Long Term Credit Bank of Japan Ltd. (The) 1,254,000 4,239,020
Sakura Bank Ltd. 950,000 3,874,170
Yasuda Trust & Banking 400,000 1,066,445
16,905,134
CREDIT & OTHER FINANCE - 6.9%
Acom Co. Ltd. 110,000 6,029,900
Credit Saison Co. Ltd. 60,000 1,609,635
Nichiei Co. Ltd. 45,000 4,933,555
Shohkoh Fund & Co. Ltd. 10,000 2,906,977
Takefuji Corp. 50,000 2,221,761
17,701,828

SHARES VALUE (NOTE 1)
SECURITIES INDUSTRY - 2.3%
Daiwa Securities Co. Ltd. 290,000 $ 1,753,488
Nomura Securities Co. Ltd. 320,000 3,720,930
Osaka Securities Finance Co. Ltd. Ord. 165,000 446,761
5,921,179
TOTAL FINANCE 40,528,141
HEALTH - 9.1%
DRUGS & PHARMACEUTICALS - 5.7%
Banyu Pharmaceutical Co. Ltd. 130,000 1,889,535
Daiichi Pharmaceutical Co. Ltd. 160,000 2,272,425
Sankyo Co. Ltd. 144,000 4,748,173
Takeda Chemical Industries Ltd. 210,000 5,720,930
14,631,063
MEDICAL EQUIPMENT & SUPPLIES - 3.4%
Hoya Corp. 110,000 3,818,937
Terumo Corp. 300,000 4,933,555
8,752,492
TOTAL HEALTH 23,383,555
INDUSTRIAL MACHINERY & EQUIPMENT - 10.3%
ELECTRICAL EQUIPMENT - 5.3%
Matsushita Electric Works Co. Ltd. 100,000 905,316
Mirai Industry Co. Ltd. 80,000 1,102,990
NGK Insulators Ltd. 500,000 4,318,937
Omron Corp. 350,000 5,930,233
Sumitomo Electric Industries Ltd. 100,000 1,320,598
13,578,074
INDUSTRIAL MACHINERY & EQUIPMENT - 5.0%
Fuji Machine Manufacturing Co.
Ltd. Ord. 160,000 4,637,874
Fujitec Co. Ltd. 150,000 1,283,223
Komatsu Ltd. Ord. 800,000 4,272,425
THK Co. Ltd. 200,000 2,674,419
12,867,941
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 26,446,015
MEDIA & LEISURE - 4.9%
ENTERTAINMENT - 1.0%
Sony Music Entertainment Japan, Inc. 70,500 2,476,869
LEISURE DURABLES & TOYS - 3.9%
Namco Ltd. 50,000 1,673,588
Nintendo Co. Ltd. Ord. 55,000 4,750,831
Shimano, Inc. 175,000 3,561,047
9,985,466
TOTAL MEDIA & LEISURE 12,462,335
NONDURABLES - 2.4%
BEVERAGES - 0.9%
Asahi Breweries Ltd. 160,000 2,365,449
HOUSEHOLD PRODUCTS - 1.5%
Uni Charm Corp. Ord. 110,000 3,700,166
TOTAL NONDURABLES 6,065,615
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
RETAIL & WHOLESALE - 2.4%
APPAREL STORES - 0.3%
Charle Co. Ltd. 70,000 $ 651,163
GENERAL MERCHANDISE STORES - 1.0%
Ito-Yokado Co. Ltd. 50,000 2,483,389
RETAIL & WHOLESALE, MISCELLANEOUS - 1.1%
Amway Japan Ltd. 80,000 2,099,668
Paris Miki, Inc. 8,800 153,488
Senshukai Co. Ltd. 110,000 703,488
2,956,644
TOTAL RETAIL & WHOLESALE 6,091,196
SERVICES - 4.5%
LEASING & RENTAL - 2.1%
Orix Corp. 80,000 5,461,794
PRINTING - 1.0%
Riso Kagaku Corp. 45,000 2,649,917
SERVICES - 1.4%
Benesse Corp. 36,000 1,073,422
Meitec Corp. 80,000 2,358,804
3,432,226
TOTAL SERVICES 11,543,937
TECHNOLOGY - 25.3%
COMMUNICATIONS EQUIPMENT - 1.5%
Matsushita Communication Industrial
Co. Ltd. 110,000 3,882,890
COMPUTER SERVICES & SOFTWARE - 1.0%
Daitec Co. Ltd. 60,000 946,844
Konami Industry Co. Ltd. 56,500 1,736,296
2,683,140
COMPUTERS & OFFICE EQUIPMENT - 6.2%
Canon, Inc. 260,000 6,305,648
Fujitsu Ltd. 350,000 3,837,209
Hitachi Ltd. 540,000 4,148,671
Nidec Corp. 40,000 1,561,462
15,852,990
ELECTRONIC INSTRUMENTS - 0.8%
Tokyo Seimitsu Co. Ltd. 75,000 2,024,502
ELECTRONICS - 13.1%
Aiwa Co. Ltd. 50,000 1,117,110
Hirose Electric Co. Ltd. 40,000 2,607,973
Hitachi Maxell Ltd. 130,000 2,893,688
Ibiden Co. Ltd. 70,000 1,162,791
Japan Aviation Electronics Industries 150,000 909,468
Minebea Co. Ltd. 530,000 5,282,392
Nichicon Corp. 100,000 1,237,542
Nitto Denko Corp. 210,000 3,784,884
Rohm Co. Ltd. 60,000 5,930,233
Shinko Electric Industries Co. Ltd. 40,000 1,694,352
TDK Corp. 46,000 3,812,957
Tokyo Electron Ltd. 46,000 2,292,359
Wako Electric Co. Ltd. 60,000 802,326
33,528,075
PHOTOGRAPHIC EQUIPMENT - 2.7%
Fuji Photo Film Co. Ltd. 130,000 4,707,641
Minolta Camera Co. Ltd. 450,000 2,335,964
7,043,605
TOTAL TECHNOLOGY 65,015,202

SHARES VALUE (NOTE 1)
UTILITIES - 2.0%
TELEPHONE SERVICES - 2.0%
Nippon Telegraph & Telephone Corp.
Ord. 605 $ 5,125,415
TOTAL COMMON STOCKS
(Cost $254,615,602) 242,912,795
CASH EQUIVALENTS - 5.2%
Taxable Central Cash Fund (b)
(Cost $13,448,135) 13,448,135 13,448,135
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $268,063,737) $ 256,360,930
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $194,642,066 and $228,384,818, respectively.
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $268,122,911. Net unrealized depreciation
aggregated $11,761,981, of which $26,939,116 related to appreciated
investment securities and $38,701,097 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $52,268,000 of which $31,995,000 and $20,273,000 will
expire on October 31, 2003 and 2005, respectively.
JAPAN
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
256,360,930
(COST $268,063,737) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
1,771,694

RECEIVABLE FOR FUND SHARES SOLD
445,443

DIVIDENDS RECEIVABLE
678,144

INTEREST RECEIVABLE 62,979

REDEMPTION FEES RECEIVABLE 104

TOTAL ASSETS
259,319,294

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 1,890,610

PAYABLE FOR FUND SHARES REDEEMED 1,486,002

ACCRUED MANAGEMENT FEE 233,873

OTHER PAYABLES AND ACCRUED EXPENSES 154,002

TOTAL LIABILITIES
3,764,487

NET ASSETS $
255,554,807

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
320,731,679

DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME
(1,145,317)

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(52,327,265)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(11,704,290)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 23,017,888 $
255,554,807
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($255,554,807 (DIVIDED BY) 23,017,888 SHARES) $11.10

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $11.10) $11.44

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 1,911,521
DIVIDENDS

INTEREST 927,878

2,839,399

LESS FOREIGN TAXES WITHHELD (284,843)

TOTAL INCOME 2,554,556

EXPENSES

MANAGEMENT FEE $ 2,204,355
BASIC FEE

PERFORMANCE ADJUSTMENT 528,549

TRANSFER AGENT FEES 900,132

ACCOUNTING FEES AND EXPENSES 222,118

NON-INTERESTED TRUSTEES' COMPENSATION 2,037

CUSTODIAN FEES AND EXPENSES 183,351

REGISTRATION FEES 46,980

AUDIT 47,318

LEGAL 4,137

REPORTS TO SHAREHOLDERS 48,790

MISCELLANEOUS 2,485

TOTAL EXPENSES BEFORE REDUCTIONS 4,190,252

EXPENSE REDUCTIONS (54,451) 4,135,801

NET INVESTMENT INCOME (LOSS) (1,581,245)

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (19,022,789)

FOREIGN CURRENCY TRANSACTIONS 640

FUTURES CONTRACTS (121,086) (19,143,235)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 9,807,916

ASSETS AND LIABILITIES IN 32,283 9,840,199
FOREIGN CURRENCIES

NET GAIN (LOSS) (9,303,036)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (10,884,281)

OTHER INFORMATION $ 592,638
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 51,864
DIRECTED BROKERAGE ARRANGEMENTS

TRANSFER AGENT CREDITS 2,587

$ 54,451

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ (1,581,245) $ (453,534)
NET INVESTMENT INCOME (LOSS)

NET REALIZED GAIN (LOSS) (19,143,235) 3,136,936

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 9,840,199 (13,924,049)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (10,884,281) (11,240,647)

DISTRIBUTIONS TO SHAREHOLDERS IN EXCESS OF NET INVESTMENT INCOME (234,962) -

SHARE TRANSACTIONS 233,528,383 208,233,225
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 230,693 -

COST OF SHARES REDEEMED (258,476,937) (251,007,290)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (24,717,861) (42,774,065)

REDEMPTION FEES 897,125 528,384

TOTAL INCREASE (DECREASE) IN NET ASSETS (34,939,979) (53,486,328)

NET ASSETS

BEGINNING OF PERIOD 290,494,786 343,981,114

END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME AND $ 255,554,807 $ 290,494,786
ACCUMULATED NET INVESTMENT LOSS OF $1,145,317 AND $345,296, RESPECTIVELY)

OTHER INFORMATION
SHARES

SOLD 19,572,662 16,223,064

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 19,451 -

REDEEMED (21,440,377) (19,823,608)

NET INCREASE (DECREASE) (1,848,264) (3,600,544)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 D 1993

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.68 $ 12.08 $ 14.27 $ 13.35 $ 9.84

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME (LOSS) (.06) C (.02) C (.02) (.04) C (.09)

NET REALIZED AND UNREALIZED GAIN (LOSS) (.55) (.40) (1.89) 1.31 3.60

TOTAL FROM INVESTMENT OPERATIONS (.61) (.42) (1.91) 1.27 3.51

LESS DISTRIBUTIONS

IN EXCESS OF NET INVESTMENT INCOME (.01) - - - -

FROM NET REALIZED GAIN - - (.36) (.39) -

TOTAL DISTRIBUTIONS (.01) - (.36) (.39) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .04 .02 .08 .04 -

NET ASSET VALUE, END OF PERIOD $ 11.10 $ 11.68 $ 12.08 $ 14.27 $ 13.35

TOTAL RETURN A, B (4.89)% (3.31)% (12.96)% 10.45% 35.67%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 255,555 $ 290,495 $ 343,981 $ 469,639 $ 118,195

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.42% 1.15% 1.15% 1.42% 1.71%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS 1.40% E 1.14% E 1.15% 1.42% 1.71%

RATIO OF NET INVESTMENT INCOME (LOSS) TO AVERAGE NET ASSETS (.54)% (.12)% (.06)% (.32)% (.77)%

PORTFOLIO TURNOVER RATE 70% 83% 86% 153% 257%

AVERAGE COMMISSION RATE F $ .0269 $ .0364

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES
TO FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE
ONE TIME SALES CHARGE. C NET INVESTMENT INCOME (LOSS) PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. D EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED
STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE, AND
FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN,
AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME PER SHARE MAY REFLECT
CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
E FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES
(SEE NOTE 7 OF NOTES TO FINANCIAL STATEMENTS). F FOR FISCAL
YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED
TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY TRADES
ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO
PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED
IN VARIOUS MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE
STRUCTURES MAY DIFFER.

</TABLE>

JAPAN SMALL COMPANIES
PERFORMANCE: THE BOTTOM LINE

JAPAN SMALL COMPANIES -28.80% -34.99%

JAPAN SMALL COMPANIES -30.93% -36.94%
(INCL. 3% SALES CHARGE)

TOKYO STOCK EXCHANGE INDEX -21.48% -21.00%

TOKYO STOCK EXCHANGE SECOND -34.87% -36.09%
SECTION STOCK PRICE INDEX

JAPANESE FUNDS AVERAGE -10.54% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1995. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
Tokyo Stock Exchange Index (TOPIX) or the Tokyo Stock Exchange Second
Section Stock Price Index. The TOPIX reflects the performance of the
larger-company stocks listed in the first section of the Tokyo Stock
Exchange, while the Second Section index reflects the performance of
the smaller companies listed in the second section. To measure how the
fund's performance stacked up against its peers, you can compare the
fund's performance to the Japanese funds average, which reflects the
performance of mutual funds with similar objectives - in this case, a
very small peer group - tracked by Lipper Analytical Services, Inc.
The past one year average represents a peer group of 31 mutual funds.
The Tokyo Stock Exchange Index and the Japanese Funds Average include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges. The Tokyo Stock Exchange Second Section Index does
not include reinvested dividends and capital gains.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

JAPAN SMALL COMPANIES -28.80% -19.37%

JAPAN SMALL COMPANIES -30.93% -20.59%
(INCL. 3% SALES CHARGE)

TOKYO STOCK EXCHANGE INDEX -21.48% -11.12%

TOKYO STOCK EXCHANGE SECOND -34.87% -20.06%
SECTION STOCK PRICE INDEX

JAPANESE FUNDS AVERAGE -10.54% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
JAPAN SMALL COMPANIES
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Kenichi Mizushita, Portfolio Manager of Fidelity
Japan Small Companies Fund
Q. KENICHI, HOW DID THE FUND PERFORM?
A. For the 12 months that ended October 31, 1997, the fund was down
28.80%. During the same period, the Japanese funds average fell
10.54%, according to Lipper Analytical Services, and the Tokyo Stock
Exchange Index (TOPIX) was down 21.48%. Both of these comparisons,
however, can be misleading, because most of the fund's competitors are
not small-company funds and the TOPIX is a large-company index. Over
the past 12 months, large-capitalization stocks in Japan performed
better than the rest of the market, while small-cap stocks had a
terrible year. A better indication of the performance of Japanese
small-capitalization stocks would be the Tokyo Stock Exchange Second
Section Stock Price Index, which the fund outperformed, as this index
fell 34.87% during the past year, not including reinvested dividends.
While it was unfortunate that the Japanese stock market as a whole -
and particularly small-company stocks - had a very difficult year, it
was heartening that the fund was able to beat the index that comprises
the smaller, less-established companies in which Fidelity Japan Small
Companies Fund invests.
Q. WHAT FACTORS AFFECTED SMALL-CAP STOCKS IN PARTICULAR?
A. The small-capitalization market experienced a significant decline
during the year for two main reasons. First, the weak Japanese economy
negatively affected small-cap stocks, because they tend to be more
sensitive to the domestic economy than large-cap stocks. Part of this
economic weakness was due to government spending cuts designed to
clear up budgetary problems. Second, smaller companies were hurt by a
consumption-tax hike in April that stalled consumer activity to a
significant degree.
Q. WHAT WAS YOUR INVESTMENT STRATEGY DURING THIS DIFFICULT YEAR?
A. I concentrated on identifying small companies that had a
competitive advantage, as well as those in sectors experiencing
increasing demand. I also considered the regulatory environment,
looking for industries that could perform well if deregulation moved
forward, such as the telecommunications industry.
Q. WHERE DID YOU FIND THESE STOCKS?
A. There were some pockets of strength in the technology sector. I
purchased additional shares of Mimasu Semiconductor, Towa Corp. and
Tokyo Seimitsu, all manufacturers of semiconductor products and
semiconductor manufacturing equipment. During the period, their
performance was good and their order inflows increased steadily,
reflecting an overall strengthening in this segment of the technology
market. Software development companies also enjoyed strong demand for
their products, as financial companies prepared to improve their
systems in anticipation of the "Year 2000" event, when systems will
need to be re-programmed to function smoothly. For example, Fuji Soft,
a company providing business software for the telecommunications and
financial services industries, experienced strong demand for its
products during the period.
Q. THIS WAS A VERY DIFFICULT YEAR FOR THE JAPANESE MARKET AS A WHOLE,
REFLECTED IN THE FUND'S OVERALL PERFORMANCE . . .
A. Obviously, there were many holdings in the fund that declined
during the year. The government, in attempting to solve its budgetary
problems, did so to some degree at the cost of the market. For
example, government construction activity was pared back
significantly, hurting construction companies and suppliers, including
Chofu Seisaku. This stock was previously one of the fund's top
holdings, but has been sold. The government also raised the
consumption tax, hurting retailers and wholesalers, including Daimon
Company. Finally, the government was slow to move on market
deregulation, shaking confidence nationwide. These events all factored
very strongly in the fund's and the market's performance.
Q. YOU'VE MENTIONED SOME STOCKS THAT HAD A NEGATIVE IMPACT ON THE
FUND'S PERFORMANCE. WERE THERE OTHERS?
A. Unfortunately, yes. Oi Electric Company, which manufactures pagers
and telecommunications equipment, performed very poorly. The domestic
pager market saw an inflow of foreign competitors, profit margins
declined and demand appeared to peak. Tokyo Denpa, a parts
manufacturer for mobile phones, faced similar problems. Although
demand for mobile phones has grown in Japan as a result of
deregulation, prices have come down because of increasing competition
from foreign manufacturers. ADO Electronic, Japan's largest personal
computer retailer, continued to perform badly as demand for personal
computers declined in Japan.
Q. DID RETAIL AND WHOLESALE STOCKS ALL SUFFER AS A RESULT OF THE
CONSUMPTION-TAX INCREASE?
A. Even though the consumption-tax hike put a damper on consumer
activity, some retailers did well. While I have reduced holdings in
this sector, I've also found competitive companies that have shown
positive sales growth and good performance, including convenience
store operators Circle K, Ministop and Matsumotokiyoshi, a drug store
chain.
Q. WHAT OTHER STOCKS HELPED THE FUND'S PERFORMANCE?
A. Meitec, the fund's largest holding at the end of the period, was
also one of the best performers. In the current economic environment,
Japanese manufacturing companies have been hesitant to add permanent
engineering staff, so they've looked to companies such as Meitec, an
outsourcing service for engineers. This company has enjoyed growing
demand for its services and has performed well. Union Tool, a drill
manufacturer, is the sole supplier to the companies that make plastic
packaging for Intel. It also performed very strongly during the year.
Q. U.S. COMPANIES WERE THE FIRST TO MOVE TOWARD "SHAREHOLDER-FRIENDLY"
POLICIES, AND EUROPEAN COMPANIES HAVE STARTED TO FOLLOW SUIT. DOES
THIS PLAY A ROLE IN JAPAN?
A. It's becoming more important. Many companies are now starting to
explore stock buybacks, and are providing more financial disclosure to
the public. Further, Japanese banks historically tended to own a good
portion of the stocks of companies with whom they had business
relationships. However, those banks have been unloading those stocks,
and more shares are being purchased by the investing public, so
companies are beginning to pay closer attention to their investors.
Q. WHAT'S YOUR OUTLOOK?
A. I think there will continue to be some tough times ahead. The
Japanese economy needs a jump-start, which it could get if the
government moves ahead on deregulating currently regulated industries.
If nothing happens on the regulatory front, I will continue to focus
on competitive companies and strong sectors. Japanese small companies
are an interesting group because of the growth taking place in this
segment of the market. Right now, the economy is weak, but it is also
cyclical. Once it begins to recover, we should see small-cap companies
begin to outperform large-cap companies. Investors in small-caps are
currently paying discount prices for taking on the additional risk
inherent in small-caps, but these investors could benefit from greater
momentum when economic recovery occurs. The small-cap market is an
under-researched segment of the market, with a greater number of
unidentified opportunities. That's where Fidelity can make a
difference, in delivering a depth and breadth of research and
investment expertise that many other firms cannot.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

KENICHI MIZUSHITA ON THE CHALLENGES FACED BY THE
JAPANESE SMALL-CAP MARKET WITHIN THE
CURRENT ECONOMIC CLIMATE:
"We have been waiting for some time for the Japanese
government to come up with a concrete strategy for
deregulation. It's been difficult to remove the cushion
that regulation has provided the market and the economy.
However, there have been small steps taken, as seen by the
recent deregulation of the telecommunications industry.
Sales are up, with 30 million people in Japan owning mobile
phones out of a population of 120 million. It's good news
that the government acknowledges that deregulation is
important and is trying to address this issue.
"However, the particular challenge for small companies
right now is that the Japanese stock market has become
polarized over time, with investors more interested in
globally competitive large companies than in small
companies. As a result, smaller companies - which are
more closely tied to the domestic economy - are presently
out of favor with investors. The bigger companies in the
First Section of the stock market have developed
competitive products, have been restructuring for some
time to remain competitive in the global market and have
succeeded in strengthening their position and performance.
To illustrate, the Bank of Japan recently released a report
showing that the business conditions faced by small
companies were much worse than those of large companies.
This information has triggered a further drop in the
performance of small companies.
"Another issue facing small companies in Japan is an
oversupply of available equity shares. Since the mid-1980s
more than 500 companies have gone public; today, there's
a total of 3,000 listed companies in Japan. Recently, some
companies have postponed going public because there is
not enough interest from investors in new small-cap issues."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of Japanese issuers
with small market capitalizations
FUND NUMBER: 360
TRADING SYMBOL: FJSCX
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$84 million
MANAGER: Kenichi Mizushita, since 1996;
manager, several Fidelity Investments Japan, Ltd.,
and institutional funds; joined Fidelity in 1985
(checkmark)
JAPAN SMALL COMPANIES
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 0.4%
JAPAN 99.6%
ROW: 1, COL: 1, VALUE: 0.0
ROW: 1, COL: 2, VALUE: 0.0
ROW: 1, COL: 3, VALUE: 0.0
ROW: 1, COL: 4, VALUE: 1.9
ROW: 1, COL: 5, VALUE: 98.09999999999999
ROW: 1, COL: 6, VALUE: 0.0
ROW: 1, COL: 7, VALUE: 0.0
ROW: 1, COL: 8, VALUE: 0.0
AS OF APRIL 30, 1997
UNITED STATES 7.3%
JAPAN 92.7%
ROW: 1, COL: 1, VALUE: 0.0
ROW: 1, COL: 2, VALUE: 0.0
ROW: 1, COL: 3, VALUE: 0.0
ROW: 1, COL: 4, VALUE: 7.3
ROW: 1, COL: 5, VALUE: 92.7
ROW: 1, COL: 6, VALUE: 0.0
ROW: 1, COL: 7, VALUE: 0.0
ROW: 1, COL: 8, VALUE: 0.0
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 99.6 92.7

SHORT-TERM INVESTMENTS 0.4 7.3

TOP TEN STOCKS

<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

MEITEC CORP. 4.6 2.3
(SERVICES)

SONY MUSIC ENTERTAINMENT JAPAN, INC. 4.1 4.0
(ENTERTAINMENT)

ADERANS CO. LTD. 3.1 1.3
(CONSUMER DURABLES)

UNION TOOL CO. 2.9 1.8
(INDUSTRIAL MACHINERY & EQUIPMENT)

CIRCLE K JAPAN CO. LTD. 2.8 2.4
(GENERAL MERCHANDISE STORES)

MIMASU SEMICONDUCTOR INDUSTRIES CO. LTD. (ELECTRONICS) 2.8 2.0

TOWA CORP. 2.7 1.3
(ELECTRONICS)

FUJI SOFT, INC. 2.5 0.0
(COMPUTER SERVICES & SOFTWARE)

SHINKO ELECTRIC INDUSTRIES CO. LTD. 2.3 1.7
(ELECTRONICS)

TOKYO SEIMITSU CO. LTD. 2.3 0.0
(ELECTRONIC INSTUMENTS)

</TABLE>

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

TECHNOLOGY 33.7 18.8

INDUSTRIAL MACHINERY & EQUIPMENT 11.6 11.5

SERVICES 9.9 2.7

MEDIA & LEISURE 8.6 9.5

DURABLES 8.5 9.3

RETAIL & WHOLESALE 8.0 14.5

CONSTRUCTION & REAL ESTATE 5.8 10.7

FINANCE 5.7 5.2

NONDURABLES 3.9 0.4

BASIC INDUSTRIES 3.0 6.1

JAPAN SMALL COMPANIES
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 99.6%
SHARES VALUE (NOTE 1)
AEROSPACE & DEFENSE - 0.9%
Jamco Corp. 65,000 $ 739,613
BASIC INDUSTRIES - 3.0%
CHEMICALS & PLASTICS - 1.6%
Nippon Pillar Packing Co. Ltd. 147,000 1,184,302
Toshiba Chemical Corp. 40,000 114,618
1,298,920
IRON & STEEL - 0.1%
Chubu Steel Plate Co. Ltd. 21,000 53,198
METALS & MINING - 0.8%
Oiles Corp. 26,000 684,552
PAPER & FOREST PRODUCTS - 0.5%
Ube-Nitto Kasei Co. Ltd. 90,000 453,738
TOTAL BASIC INDUSTRIES 2,490,408
CONSTRUCTION & REAL ESTATE - 5.8%
BUILDING MATERIALS - 1.9%
Arc Land Sakamoto Co. Ltd. 120,000 1,046,512
Kikusui Chemical Industries Co. Ltd. 4,000 18,605
Kondotec, Inc. 95,000 520,764
1,585,881
ENGINEERING - 1.6%
Ataka Construction & Engineering
Co. Ltd. 130,000 577,658
Sawako Corp. 102,500 774,709
1,352,367
REAL ESTATE - 2.3%
Meiwa Estate Co. Ltd. 30,000 353,821
Sekiwa Real Estate Ltd. 99,000 452,243
Toc Co. Ltd. 110,000 1,105,482
1,911,546
TOTAL CONSTRUCTION & REAL ESTATE 4,849,794
DURABLES - 8.5%
AUTOS, TIRES, & ACCESSORIES - 5.4%
FCC Co. Ltd. 42,000 662,791
Keihin Seiki Manufacturing Co. Ltd. 110,000 1,498,339
Piolax, Inc. 50,000 735,050
Sanyo Denki Co. Ltd. 140,000 1,186,047
Yachiyo Industry Co. Ltd. 67,000 362,267
4,444,494
CONSUMER DURABLES - 3.1%
Aderans Co. Ltd. 97,000 2,610,299
TEXTILES & APPAREL - 0.0%
Jeans Mate Corp. 60 444
TOTAL DURABLES 7,055,237
FINANCE - 5.7%
CREDIT & OTHER FINANCE - 5.7%
Acom Co. Ltd. 24,000 1,315,615
Jafco Co. Ltd. 20,000 946,844
Shohkoh Fund & Co. Ltd. 4,000 1,162,791
Takefuji Corp. 29,000 1,288,621
4,713,871
INDUSTRIAL MACHINERY & EQUIPMENT - 11.6%
Fuji Denki Reiki Co. Ltd. 110,000 533,555
Misumi Corp. 102,190 1,663,558
Nitto Kohki Co. Ltd. 37,600 671,429

SHARES VALUE (NOTE 1)
Shinkawa Ltd. 30,000 $ 523,256
THK Co. Ltd. 120,000 1,604,651
Tsudakoma Corp. 100,000 332,226
Union Tool Co. 76,900 2,395,141
Yushin Precision Equipment Co. Ltd. 110,000 1,872,924
9,596,740
MEDIA & LEISURE - 8.6%
ENTERTAINMENT - 4.1%
Sony Music Entertainment Japan, Inc. 97,000 3,407,890
LEISURE DURABLES & TOYS - 2.5%
Honma Golf Co. Ltd. 67,000 856,977
Ryohin Keikaku Co. Ltd. 18,000 1,248,339
2,105,316
PUBLISHING - 0.9%
Asia Securities Printing Co. Ltd. 50,000 726,744
RESTAURANTS - 1.1%
Yoshinoya D&C Co. Ltd. Ord. 88 928,239
TOTAL MEDIA & LEISURE 7,168,189
NONDURABLES - 3.9%
FOODS - 2.6%
Rock Field Co. Ltd. 70,000 889,535
Yonekyu Corp. 90,000 1,248,339
2,137,874
HOUSEHOLD PRODUCTS - 1.3%
Comany, Inc. 120,000 1,116,279
TOTAL NONDURABLES 3,254,153
RETAIL & WHOLESALE - 8.0%
APPAREL STORES - 2.6%
Fast Retailing Co. Ltd. 60,000 1,121,262
Naigai Clothes Co. Ltd. 155,000 1,029,900
2,151,162
GENERAL MERCHANDISE STORES - 4.5%
Circle K Japan Co. Ltd. 46,000 2,361,130
Matsumotokiyoshi Co. Ltd. 38,000 1,388,704
3,749,834
GROCERY STORES - 0.1%
U Store Co. Ltd. 5,000 45,681
RETAIL & WHOLESALE, MISCELLANEOUS - 0.8%
Yamada Denki Co. Ltd. 53,000 669,103
TOTAL RETAIL & WHOLESALE 6,615,780
SERVICES - 9.9%
Aucnet, Inc. 36,000 603,987
BellSystem24, Inc. 10,000 1,378,738
Estelle Co. Ltd. 60,000 498,339
Meitec Corp. 130,000 3,833,057
Nippon System Development Co. 75,000 1,868,771
8,182,892
TECHNOLOGY - 33.7%
COMMUNICATIONS EQUIPMENT - 0.7%
Fujitsu Denso 35,000 546,512
COMPUTER SERVICES & SOFTWARE - 9.3%
Diamond Computer Service Co. Ltd. 50,000 851,329
Fuji Soft, Inc. 59,400 2,047,425
Ines Corp. Ord. 100,000 1,420,266
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TECHNOLOGY - CONTINUED
COMPUTER SERVICES & SOFTWARE - CONTINUED
Konami Industry Co. Ltd. 55,000 $ 1,690,199
Sumisho Computer Service Corp. 90,000 1,719,269
7,728,488
COMPUTERS & OFFICE EQUIPMENT - 2.2%
IO Data Device, Inc. 22,900 346,163
Toyo Information System Co. Ltd. 100,000 1,461,794
1,807,957
ELECTRONIC INSTRUMENTS - 5.2%
Cosel Co. Ltd. 75,000 903,239
Micronics Japan Co. Ltd. 20,000 737,542
Sony Chemicals Corp. 50,000 805,648
Tokyo Seimitsu Co. Ltd. 70,000 1,889,535
4,335,964
ELECTRONICS - 13.7%
ADO Electronic Industrial Co. Ltd. 72,000 849,169
Fujitsu Business Systems Ltd. 41,000 837,708
Kyoden Co. Ltd. (a) 26,000 660,797
Mimasu Semiconductor Industries
Co. Ltd. 126,000 2,354,651
Nippon Ceramic Co. Ltd. 80,000 1,235,880
Shindengen Electric Co. Ltd. 119,000 937,965
Shinko Electric Industries Co. Ltd. 46,000 1,948,505
Tokyo Denpa Co. Ltd. 30,000 348,837
Towa Corp. 58,000 2,220,764
11,394,276
PHOTOGRAPHIC EQUIPMENT - 2.6%
Noritsu Koki Co. Ltd. 33,000 1,096,346
Ricoh Elemex Corp. 130,000 1,058,140
2,154,486
TOTAL TECHNOLOGY 27,967,683
TOTAL COMMON STOCKS
(Cost $93,794,873) 82,634,360
CASH EQUIVALENTS - 0.4%
Taxable Central Cash Fund (b)
(Cost $296,203) 296,203 296,203
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $94,091,076) $ 82,930,563
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $100,096,244 and $89,021,094, respectively.
The fund participated in the bank borrowing program. The maximum loan
and average daily balance during the period for which the loan was
outstanding amounted to $2,150,000 and $1,890,100, respectively. The
weighted average interest rate was 6.0% (see Note 6 of Notes to
Financial Statements).
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $94,231,139. Net unrealized depreciation
aggregated $11,300,576, of which $6,099,075 related to appreciated
investment securities and $17,399,651 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $38,186,000 all of which will expire on October 31,
2005.
JAPAN SMALL COMPANIES
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
82,930,563
(COST $94,091,076) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
1,495,612

RECEIVABLE FOR FUND SHARES SOLD 181,509

DIVIDENDS RECEIVABLE 183,292

INTEREST RECEIVABLE 7,429

REDEMPTION FEES RECEIVABLE 494

TOTAL ASSETS
84,798,899

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 152,940

PAYABLE FOR FUND SHARES REDEEMED 243,500

ACCRUED MANAGEMENT FEE 56,285

OTHER PAYABLES AND ACCRUED EXPENSES 72,225

TOTAL LIABILITIES 524,950

NET ASSETS $
84,273,949

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
134,250,323

DISTRIBUTIONS IN EXCESS OF NET
(492,464)
INVESTMENT INCOME

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(38,322,954)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(11,160,956)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 13,015,446 $
84,273,949
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($84,273,949 (DIVIDED BY) 13,015,446 SHARES) $6.47

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $6.47) $6.67

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 590,727
DIVIDENDS

INTEREST 328,953

919,680

LESS FOREIGN TAXES WITHHELD (88,609)

TOTAL INCOME 831,071

EXPENSES

MANAGEMENT FEE $ 702,501

TRANSFER AGENT FEES 310,462

ACCOUNTING FEES AND EXPENSES 74,385

NON-INTERESTED TRUSTEES' COMPENSATION 549

CUSTODIAN FEES AND EXPENSES 84,325

REGISTRATION FEES 43,922

AUDIT 31,787

LEGAL 741

INTEREST 3,172

REPORTS TO SHAREHOLDERS 15,209

MISCELLANEOUS 817

TOTAL EXPENSES BEFORE REDUCTIONS 1,267,870

EXPENSE REDUCTIONS (5,108) 1,262,762

NET INVESTMENT INCOME (LOSS) (431,691)

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (38,204,770)

FOREIGN CURRENCY TRANSACTIONS 4,699 (38,200,071)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 7,150,227

ASSETS AND LIABILITIES IN 10,754 7,160,981
FOREIGN CURRENCIES

NET GAIN (LOSS) (31,039,090)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (31,470,781)

OTHER INFORMATION $ 274,403
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 62
CUSTODIAN CREDITS

TRANSFER AGENT CREDITS 5,046

$ 5,108

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ (431,691) $ (333,376)
NET INVESTMENT INCOME (LOSS)

NET REALIZED GAIN (LOSS) (38,200,071) 698,907

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 7,160,981 (18,321,937)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (31,470,781) (17,956,406)

DISTRIBUTIONS TO SHAREHOLDERS (53,184) -
IN EXCESS OF NET INVESTMENT INCOME

FROM NET REALIZED GAIN (359,714) -

TOTAL DISTRIBUTIONS (412,898) -

SHARE TRANSACTIONS 128,561,609 207,082,528
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 410,794 -

COST OF SHARES REDEEMED (118,965,973) (83,815,966)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 10,006,430 123,266,562

REDEMPTION FEES 486,767 354,275

TOTAL INCREASE (DECREASE) IN NET ASSETS (21,390,482) 105,664,431

NET ASSETS 105,664,431 -
BEGINNING OF PERIOD

END OF PERIOD (INCLUDING DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME AND
ACCUMULATED NET INVESTMENT LOSS OF $ 84,273,949 $ 105,664,431
$492,464 AND $105,103, RESPECTIVELY)

OTHER INFORMATION
SHARES

SOLD 16,940,710 19,679,280

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 49,197 -

REDEEMED (15,551,026) (8,102,715)

NET INCREASE (DECREASE) 1,438,881 11,576,565

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.13 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME (LOSS) C (.03) (.03)

NET REALIZED AND UNREALIZED GAIN (LOSS) (2.63) (.87)

TOTAL FROM INVESTMENT OPERATIONS (2.66) (.90)

LESS DISTRIBUTIONS

IN EXCESS OF NET INVESTMENT INCOME (.01) F -

FROM NET REALIZED GAIN (.03) F -

TOTAL DISTRIBUTIONS (.04) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .04 .03

NET ASSET VALUE, END OF PERIOD $ 6.47 $ 9.13

TOTAL RETURN A, B (28.80)% (8.70)%

RATIOS AND SUPPLEMENTAL DATA $ 84,274 $ 105,664
NET ASSETS, END OF PERIOD (000 OMITTED)

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.35% 1.34%

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS 1.34% E 1.34%

RATIO OF NET INVESTMENT INCOME (LOSS) TO AVERAGE NET ASSETS (.46)% (.32)%

PORTFOLIO TURNOVER RATE 101% 66%

AVERAGE COMMISSION RATE D $ .0511 $ .0578

</TABLE>

LATIN AMERICA
PERFORMANCE: THE BOTTOM LINE

LATIN AMERICA 25.42% 60.88%

LATIN AMERICA 21.65% 56.06%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL 24.05% 90.39%
INTERNATIONAL EMERGING MARKETS
FREE - LATIN AMERICA INDEX

LATIN AMERICAN REGION 19.47% N/A
FUNDS AVERAGE

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on April 19, 1993. For example, if you had invested $1,000 in
a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Morgan Stanley Capital International (MSCI)
Emerging Markets Free - Latin America Index - a market capitalization
weighted index of approximately 170 stocks traded in seven Latin
American markets. To measure how the fund's performance stacked up
against its peers, you can compare it to the Latin American region
funds average, which reflects the performance of mutual funds with
similar objectives - in this case, a very small peer group - tracked
by Lipper Analytical Services, Inc. The past one year average
represents a peer group of 34 mutual funds. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effect
of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

LATIN AMERICA 25.42% 11.05%

LATIN AMERICA 21.65% 10.31%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL INTERNATIONAL 24.05% 15.25%
EMERGING MARKETS FREE -
LATIN AMERICA INDEX

LATIN AMERICAN REGION 19.47% N/A
FUNDS AVERAGE

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
LATIN AMERICA
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Patti Satterthwaite, Portfolio Manager of Fidelity
Latin America Fund
Q. HOW DID THE FUND PERFORM, PATTI?
A. The fund outpaced both its peer group and index over the 12-month
period that ended October 31, 1997. During this period, the fund had a
return of 25.42%. To compare the fund's performance with that of its
peers, the Latin American regions funds average returned 19.47% for
the same one-year period, according to Lipper Analytical Services. To
gauge how the fund did relative to Latin American markets, the Morgan
Stanley Capital International Emerging Markets Free - Latin America
Index returned 24.05%.
Q. HOW WOULD YOU CHARACTERIZE THE INVESTING ENVIRONMENT OVER THE PAST
YEAR?
A. From the beginning of the period through the end of June, I would
say it was quite good. Strong economic growth coupled with relatively
low interest rates across the region provided the underpinnings for an
extremely impressive stock market rally through the first half of the
year. What's more, the political environment was favorable as
authorities in various countries continued to make strides toward
economic reform by improving budgetary and trade surpluses. Another
factor aiding the dramatic rise of Latin American stocks was investor
inflows. As the markets continued to rise and volatility diminished,
the region attracted a very large amount of new investment.
Q. AFTER POSTING STUNNING GAINS THROUGHOUT MUCH OF THE PERIOD, THE
LATIN AMERICAN MARKETS EXPERIENCED SIGNIFICANT LOSSES IN OCTOBER. WHAT
CAUSED THE TURNABOUT?
A. The problems began in the summer, when Brazil's stock market
dropped on fears that the country's currency - the real - was
extremely overvalued. Despite Brazil's declining stock prices, Mexican
stocks - which make up the other major market in the region -
continued to post impressive gains. Briefly setting devaluation fears
aside in August, Brazilian stocks resumed their rally, although they
charted an unsteady course through mid-October, when an attack on the
Hong Kong currency touched off a rout in Southeast Asian markets. That
concerned investors who pulled their money out and forced the Brazil
market to suffer heavy losses. That, in turn, set off a "samba
effect." By that I mean that the Mexican and other Latin American
markets also sold off - but to a lesser extent than Brazil's - as the
region's economic growth prospects were called into question. To
discourage investors from selling the real, Brazil's central bank
doubled interest rates to about 43% on October 30. The net result was
that the region's economy, which had been expected to grow at a
reasonable pace, was suddenly facing the possibility of a major
economic slowdown.
Q. WHAT HELPED THE FUND OUTPACE BOTH ITS PEERS AND THE INDEX DURING
THE YEAR?
A. There were three main factors. First, the fund had less invested in
Brazil than many of its competitors and the index from about June on.
Although the fund greatly benefited from its Brazilian holdings in the
first half of the period, I became concerned that the country's large
budget deficit would force interest rates higher. So I pared back
Brazilian stocks, although they continued to account for the fund's
largest country concentration. Of course, interest rates did rise and
having a smaller stake in Brazil helped the fund's performance. The
second related positive factor contributing to the fund's performance
was security selection in Brazil - meaning what the fund did and
didn't own. The prospect of higher interest rates caused me to avoid
interest-rate-sensitive and economically sensitive companies in
Brazil, including banks and industrial companies. Although they led
the market in the first half of the year, banks and manufacturers were
among the companies hardest hit in the market's mid-summer-to-fall
sell-off.
Q. AND THE THIRD REASON FOR THE FUND'S OUTPERFORMANCE?
A. Throughout most of the year, I continued to cut back the fund's
stake in Chile and kept the fund's exposure there rather small. That
strategy benefited the fund's performance as the Chilean markets
suffered from a bout of profit-taking in September and sold off with
the region in October.
Q. WERE THERE ANY DISAPPOINTMENTS DURING THE PERIOD?
A. Mexican banks Grupo Financiero Bancomer and BANACCI SA
underperformed early in the period, as the recovery in bank earnings
took longer than anticipated, as did the improvement in past-due
loans. However, later in the year, these stocks started to show better
trends in earnings and, more importantly, in past-due accounts.
Q. WHAT BRAZILIAN STOCKS DID YOU FIND ATTRACTIVE?
A. I focused on state-owned utility companies including phone giant
Telebras and its subsidiaries - Telebras and Telesp. I felt that the
Brazilian government would have to continue to follow through on its
plans to make these companies profitable in order to privatize them
and raise money for the country. Additionally, these utilities tend to
be less economically sensitive than other industries. These companies
enjoyed strong performance in the first half of the year, and
weathered the summer and fall storm better than many other Brazilian
stocks.
Q. WHAT COMPANIES DID YOU FIND ATTRACTIVE IN MEXICO, THE FUND'S
SECOND-LARGEST COUNTRY CONCENTRATION?
A. For the first time in many years, I built up the fund's holdings in
Telefonos de Mexico - the country's major telephone provider - because
I felt that market expectations regarding long distance competition
proved to be bearish. In addition, over the past two to three years
the company has bought back more than 20% of its stock. Not only was
Telefonos de Mexico one of the fund's largest holdings, it was also
one of its best performers for the year. I also liked Grupo Carso, a
large conglomerate with interests in auto-parts manufacturing,
specialty chemicals, food and real estate. Beer maker Fomento
Economico was also attractive given its increased operating margins
and strong earnings growth.
Q. ASIDE FROM YOUR BRAZILIAN AND MEXICAN HOLDINGS, WHAT WERE OTHER
STRONG PERFORMERS?
A. Argentinean oil company YPF was one of the biggest contributors to
performance. The stock performed well as the company hit its
production targets and improved profitability under a capable new
management team.
Q. WHAT'S YOUR OUTLOOK?
A. I'll probably continue to underweight Brazil and overweight Mexico.
With a currency that remains overvalued and the prospect for higher
interest rates slowing the economy, the Brazilian market could
continue to come under pressure. Add to that the presidential election
next year, and there's bound to be some uncertainty. In Brazil, I'll
likely overweight the state-owned companies because I believe the
government is committed to their profitability prior to their
privatization. Meanwhile, I'll probably continue to overweight Mexico.
At present, I think the economy there looks good and the currency
isn't hugely overvalued.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

PATTI SATTERTHWAITE ON BRAZIL:
"In assessing the Latin American region's prospects
over the next year, it's important to understand the issues
facing Brazil. As the largest economy in the Latin American
region - more than twice the size of the next-largest economy,
Mexico - Brazil's influence on the region is vast. That said,
it's pretty clear that the country will face much lower economic
growth in the year ahead, as a function of interest rates rising
dramatically this year. That slower growth could translate
into lower earnings growth for many companies in Brazil.
The question becomes how much economic growth will slow.
"There's also a political element to consider. President
Fernando Henrique Cardoso - who has guided the country
through important fiscal and economic reforms - is up for
re-election next year. The outcome could have a major impact
on Brazil's future and it's a development I'll be watching
carefully. But, so far, I think his administration has reacted
quite respectably to the recent crisis by cutting spending
and raising taxes. And despite potential political fallout, the
government doubled interest rates in a pre-election year."

FUND FACTS
GOAL: high total investment return by investing
mainly in equity and debt securities of Latin
American issuers
FUND NUMBER: 349
TRADING SYMBOL: FLATX
START DATE: April 19, 1993
SIZE: as of October 31, 1997, more than
$808 billion
MANAGER: Patti Satterthwaite, since 1993;
assistant manager, Latin American portion of
Fidelity Emerging Markets Fund, since 1990;
securities and Latin American analyst,
1986-1990; joined Fidelity in 1986
(checkmark)
LATIN AMERICA
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
ARGENTINA
10.8%
UNITED STATES 7.1%
ROW: 1, COL: 1, VALUE: 7.1
ROW: 1, COL: 2, VALUE: 6.8
ROW: 1, COL: 3, VALUE: 32.9
ROW: 1, COL: 4, VALUE: 4.6
ROW: 1, COL: 5, VALUE: 37.8
ROW: 1, COL: 6, VALUE: 10.8
OTHER 6.8%
MEXICO 32.9%
BRAZIL 37.8%
CHILE 4.6%
AS OF APRIL 30, 1997
ARGENTINA 9.7%
UNITED STATES 10.5%
ROW: 1, COL: 1, VALUE: 10.5
ROW: 1, COL: 2, VALUE: 6.5
ROW: 1, COL: 3, VALUE: 25.8
ROW: 1, COL: 4, VALUE: 6.0
ROW: 1, COL: 5, VALUE: 41.5
ROW: 1, COL: 6, VALUE: 9.699999999999999
OTHER 6.5%
MEXICO 25.8%
BRAZIL 41.5%
CHILE 6.0%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 92.9 89.5

SHORT-TERM INVESTMENTS 7.1 10.5

TOP TEN STOCKS

<TABLE>
<CAPTION>
<S> <C> <C>
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

TELEFONOS DE MEXICO SA SPONSORED ADR 6.9 5.3
REPRESENTING ORD. CLASS L SHARES
(MEXICO, TELEPHONE SERVICES)

CENTRAIS ELECTRICAS BRASILEIRAS SA 6.4 5.2
(BRAZIL, ELECTRIC UTILITY)

TELEBRAS SPONSORED ADR 6.3 6.8
(BRAZIL, TELEPHONE SERVICES)

YPF SOCIEDAD ANONIMA SPONSORED 4.8 3.4
ADR REPRESENTING CLASS D SHARES
(ARGENTINA, OIL & GAS)

GRUPO CARSO SA DE CV CLASS A-1 3.9 3.1
(MEXICO, TOBACCO)

PETROBRAS PN (PFD. REG.) 3.6 3.9
(BRAZIL, OIL & GAS)

COMPANIA ENERGERTICA MINAS GERAIS (BRAZIL, ELECTRIC UTILITY) 3.4 2.6

GRUPO FINANCIERO BANCOMER CLASS B 2.9 1.8
(MEXICO, BANKS)

TELEBRAS ON 2.5 3.3
(BRAZIL, TELEPHONE SERVICES)

COMPANIA CERVEJARIA BRAHMA PN 2.4 2.7
(PFD. REG.)
(BRAZIL, BEVERAGES)

</TABLE>

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

UTILITIES 38.1 36.4

NONDURABLES 15.4 13.5

ENERGY 10.8 11.0

FINANCE 8.9 11.1

BASIC INDUSTRIES 8.2 6.9

RETAIL & WHOLESALE 4.4 2.9

CONSTRUCTION & REAL ESTATE 3.8 3.1

PRECIOUS METALS 1.1 1.3

MEDIA & LEISURE 1.0 1.2

DURABLES 0.7 1.1

LATIN AMERICA
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 92.9%
SHARES VALUE (NOTE 1)
ARGENTINA - 10.8%
Banco de Galicia y Buenos Aires
SA sponsored ADR representing
Class B shares 323,888 $ 7,849,223
Bansud SA Class B (a) 101,790 906,457
Cresud Sacifya sponsored ADR 104,500 1,881,000
IRSA (Inversiones y Representa) SA GDR 43,800 1,478,250
Perez Companc Class B 2,378,336 14,897,024
S.A. Importadora y Exportadora
de la Patagonia Class B 153,000 2,219,787
Telecom Argentina Class B sponsored
ADR 709,200 17,951,625
Telefonica de Argentina SA sponsored
ADR 57,900 1,628,438
YPF Sociedad Anonima sponsored
ADR representing Class D shares 1,238,600 39,635,200
88,447,004
BRAZIL - 37.8%
Aracruz Celulose SA ADR 692,050 10,380,750
Banco Real SA (Reg.) 84,000 68,565
Bradesco PN 852,535,377 6,340,306
Centrais Electricas Brasileiras SA 121,331,010 52,489,469
Cimento Itau PN Ord. 6,044,000 1,551,290
Compania Cervejaria Brahma PN:
(Pfd. Reg.) warrants 4/30/03 (a) 1,895,770 257,905
(Pfd. Reg.) 31,851,523 19,932,479
(Reg.) 117,827 79,292
Companhia de Saneamento Basico (a) 12,496,000 2,311,975
Compania Energertica Minas Gerais 698,600,000 27,878,122
Compania Paulista de Forca Luz Ord. 21,235,597 3,110,227
Companhia Brasileira de Petroleo
Ipiranga SA Class B 321,249,000 4,661,708
Companhia Paranaense de
Energia-Copel Class B 576,880 6,886,505
Coteminas PN 10,053,310 3,737,395
Dixie Toga SA 1,904,400 949,955
Encorpar Redito e Participa SA (a) 11,465,310 104
Eletropaulo SA PN (a) 3,411,000 581,596
Itaubanco PN (Pfd. Reg.) 7,117,100 2,872,401
Itausa Investimentos Itau SA 4,623,000 3,144,613
Klabin Industria de Papel e Celulose PN 5,746,165 4,429,748
Light Participacoes SA (a) 16,248,000 4,155,574
Light Servicos de Electricidade SA Ord. 15,127,000 5,021,297
Perdigao SA PN 1,461,114,630 2,583,981
Perdigao SA ON 23,222,143 47,387
Petrobras PN (Pfd. Reg.) 158,880,000 29,539,637
Souza Cruz Industria Comerico 537,500 4,372,733
Telebras sponsored ADR 506,100 51,369,150
Telebras PN (Pfd. Reg.) 177,440,597 17,702,219
Telebras ON 226,774,800 20,153,885
Telesp PN:
(Pfd. Reg.) 72,825,066 19,021,965
rights 11/12/97 (a) 4,004,678 3,632
Companhia Vale do Rio Doce (a) 290,000 2,630
Votorantim Celulose e Papel SA
(Pfd. Reg.) 145,251,499 3,465,962
309,104,457
CHILE - 4.6%
Chilectra SA sponsored ADR 37,500 979,688
Cristalerias de Chile SA sponsored ADR 124,700 1,932,850
Empresa Nacional de Electricidad SA
sponsored ADR 96,000 1,932,000

SHARES VALUE (NOTE 1)
Enersis SA sponsored ADR 434,500 $ 14,338,500
Quinenco SA sponsored ADR 150,000 2,197,623
Soc Quimica y Minera de Chile ADR 214,500 11,127,188
Supermercados Unimarc SA
sponsored ADR 201,000 3,015,000
Vina Concha Stet y Toro
SA sponsored ADR 61,000 1,662,250
37,185,099
COLOMBIA - 2.0%
Banco Ganadero Class C sponsored ADR 79,800 1,915,200
Banc Industrial Colombiano
sponsored ADR 222,600 3,561,600
Compania Nacional de Chocolates 136,000 1,090,478
Noel (Industria Alimenticias) 95,771 372,773
Noel (Industria Alimenticias)
rights 12/30/97 21,886 -
Suramericana de Seguros SA 440,350 9,769,754
16,709,805
LUXEMBOURG - 0.3%
Quilmes Industrial SA sponsored ADR 201,300 2,491,088
MEXICO - 32.9%
Apasco SA de CV 309,000 1,880,549
BANACCI SA de CV Class B (a) 160,000 316,945
Cemex SA, Series B 2,680,000 11,768,974
Cifra SA de CV:
Series A 613,164 1,125,354
Series C 9,315,200 16,118,187
Corporacion Geo SA de CV Class B
sponsored ADR (a)(c) 40,800 867,000
Corporacion Geo SA de CV (a) 1,846,873 9,961,654
DESC (Sociedad de Fomento
Industrial SA) Class B 1,149,000 9,872,076
Fomento Economico Mexicano
SA de CV Class B 2,479,600 17,457,804
Gruma SA Class B (a) 1,824,264 7,140,317
Grupo Imsa SA de CV sponsored ADR 53,500 1,273,969
Grupo Carso SA de CV Class A-1 5,031,100 31,879,643
Grupo Financiero Bancomer Class B (a) 50,989,700 24,034,525
Grupo Televisa SA de CV sponsored
ADR (a) 262,600 8,140,600
Grupo Elektra SA 10,252,000 13,946,635
Grupo Modelo SA de CV Class C Ord. 2,276,500 16,842,840
Grupo Mexico SA, Class L 1,427,000 4,223,103
Grupo Financiero Inbursa SA Class B 4,406,900 15,513,550
Industrias Bachoco SA sponsored ADR 24,300 413,100
Industrias Penoles SA 178,000 706,265
Kimberly Clark de Mexico SA Class A 3,383,000 14,856,134
Telefonos de Mexico SA sponsored ADR
representing Ord. Class L shares 1,303,200 56,363,400
Tubos de Acero de Mexico ADR (a) 210,500 4,249,469
268,952,093
PANAMA - 1.7%
Panamerican Beverages, Inc. Class A 450,100 13,953,100
PERU - 1.4%
Compania de Cementos Lima SA
Class C 162,081 3,372,956
Compania de Minas Buenaventura SA:
Class A 100,526 873,817
Class B 33,551 310,177
Class B sponsored ADR 339,000 6,080,813
Class T 98,541 744,048
11,381,811
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
VENEZUELA - 1.4%
Compania Anonima Nacional Telefonos
de Venezuela sponsored ADR 77,600 $ 3,101,121
Electricidad de Caracas 3,371,954 4,428,332
Mavesa SA sponsored ADR 513,933 3,854,498
11,383,951
TOTAL COMMON STOCKS
(Cost $619,234,639) 759,608,408
CASH EQUIVALENTS - 7.1%
Taxable Central Cash Fund (b)
(Cost $58,380,712) 58,380,712 58,380,712
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $677,615,351) $ 817,989,120
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to $867,000
or 0.1% of net assets.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $591,883,679 and $491,111,414, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $10,387 for the period.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Basic Industries 8.2%
Cash Equivalents 7.1
Construction & Real Estate 3.8
Durables 0.7
Energy 10.8
Finance 8.9
Holding Companies 0.4
Media & Leisure 1.0
Nondurables 15.4
Precious Metals 1.1
Retail & Wholesale 4.4
Services 0.1
Utilities 38.1
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $681,569,035. Net unrealized appreciation
aggregated $136,420,085, of which $185,096,888 related to appreciated
investment securities and $48,676,803 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $117,765,000 of which $80,150,000, and $37,615,000 will
expire on October 31, 2003, and 2004, respectively.
LATIN AMERICA
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
817,989,120
(COST $677,615,351) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
11,283,367

RECEIVABLE FOR FUND SHARES SOLD
3,926,608

DIVIDENDS RECEIVABLE
1,248,756

INTEREST RECEIVABLE
353,504

REDEMPTION FEES RECEIVABLE 21,632

TOTAL ASSETS
834,822,987

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 8,819,311

PAYABLE FOR FUND SHARES REDEEMED 16,229,517

ACCRUED MANAGEMENT FEE 651,706

OTHER PAYABLES AND 580,315

ACCRUED EXPENSES

TOTAL LIABILITIES
26,280,849

NET ASSETS $
808,542,138

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
781,226,008

UNDISTRIBUTED NET INVESTMENT INCOME
8,495,570

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(121,520,381)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
140,340,941
AND ASSETS AND LIABILITIES IN FOREIGN CURRENCIES

NET ASSETS, FOR 52,115,671 $
808,542,138
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($808,542,138 (DIVIDED BY) 52,115,671 SHARES) $15.51

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $15.51) $15.99

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 18,355,872
DIVIDENDS

INTEREST 3,990,444

22,346,316

LESS FOREIGN TAXES WITHHELD (809,788)

TOTAL INCOME 21,536,528

EXPENSES

MANAGEMENT FEE $ 6,463,852

TRANSFER AGENT FEES 2,303,061

ACCOUNTING FEES AND EXPENSES 514,541

NON-INTERESTED TRUSTEES' COMPENSATION 4,497

CUSTODIAN FEES AND EXPENSES 1,141,426

REGISTRATION FEES 109,953

AUDIT 68,557

LEGAL 5,298

REPORTS TO SHAREHOLDERS 125,192

MISCELLANEOUS 519,859

TOTAL EXPENSES BEFORE REDUCTIONS 11,256,236

EXPENSE REDUCTIONS (73,737) 11,182,499

NET INVESTMENT INCOME 10,354,029

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 66,007,545

FOREIGN CURRENCY TRANSACTIONS (972,800) 65,034,745

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 64,927,910

ASSETS AND LIABILITIES IN (8,067) 64,919,843
FOREIGN CURRENCIES

NET GAIN (LOSS) 129,954,588

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 140,308,617

OTHER INFORMATION $ 2,213,110
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 65,245
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 5,818

TRANSFER AGENT CREDITS 2,674

$ 73,737

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 10,354,029 $ 8,995,030
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 65,034,745 (33,471,294)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 64,919,843 168,576,025

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 140,308,617 144,099,761

DISTRIBUTIONS TO SHAREHOLDERS FROM NET INVESTMENT INCOME (9,458,525) (5,626,729)

SHARE TRANSACTIONS 704,350,162 348,744,157
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 9,235,878 5,493,619

COST OF SHARES REDEEMED (595,524,911) (401,997,197)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 118,061,129 (47,759,421)

REDEMPTION FEES 1,741,603 886,945

TOTAL INCREASE (DECREASE) IN NET ASSETS 250,652,824 91,600,556

NET ASSETS

BEGINNING OF PERIOD 557,889,314 466,288,758

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $8,495,570 AND
$8,572,867, RESPECTIVELY) $ 808,542,138 $ 557,889,314

OTHER INFORMATION
SHARES

SOLD 43,052,799 29,713,125

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 724,384 552,485

REDEEMED (35,962,567) (33,772,507)

NET INCREASE (DECREASE) 7,814,616 (3,506,897)

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED OCTOBER 31, APRIL 19, 1993
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 E 1993

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.59 $ 9.75 $ 16.21 $ 13.28 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .20 D .22 .04 .07 .03

NET REALIZED AND UNREALIZED GAIN (LOSS) 2.92 2.72 (6.52) 2.82 3.23

TOTAL FROM INVESTMENT OPERATIONS 3.12 2.94 (6.48) 2.89 3.26

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.23) (.12) - (.05) -

FROM NET REALIZED GAIN - - - (.05) -

TOTAL DISTRIBUTIONS (.23) (.12) - (.10) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .03 .02 .02 .14 .02

NET ASSET VALUE, END OF PERIOD $ 15.51 $ 12.59 $ 9.75 $ 16.21 $ 13.28

TOTAL RETURN B, C 25.42% 30.69% (39.85)% 22.89% 32.80%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 808,542 $ 557,889 $ 466,289 $ 888,530 $ 342,934

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.30% 1.32% 1.41% 1.48% 1.94% A

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER
EXPENSE REDUCTIONS 1.29% F 1.32% 1.41% 1.48% 1.94% A

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 1.19% 1.48% .97% .47% 1.21% A

PORTFOLIO TURNOVER RATE 64% 70% 57% 77% 72% A

AVERAGE COMMISSION RATE G $ .0005 $ .0004

A ANNUALIZED B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7
OF NOTES TO FINANCIAL STATEMENTS). C TOTAL RETURNS DO NOT INCLUDE
THE ONE TIME SALES CHARGE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED. D NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. E EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED
STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION
OF INCOME, CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY
INVESTMENT COMPANIES." AS A RESULT, NET INVESTMENT INCOME PER
SHARE MAY REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO
TAX DIFFERENCES.
F FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES
(SEE NOTE 7 OF NOTES TO FINANCIAL STATEMENTS). G FOR FISCAL YEARS
BEGINNING ON OR AFTER SEPTEMBER 1, 1995,
A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE
FOR SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY
VARY FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON THE MIX OF
TRADES EXECUTED IN VARIOUS MARKETS WHERE
TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY DIFFER.

</TABLE>

NORDIC
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

NORDIC 26.24% 61.20%

NORDIC (INCL. 3% SALES CHARGE) 22.45% 56.37%

FT - ACTUARIES WORLD NORDIC INDEX 27.30% 55.44%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1995. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the FT - Actuaries World Nordic Index - a market
capitalization weighted index of over 90 stocks traded in four
Scandinavian markets. The index is designed to provide coverage of
approximately 85% of investable equity available in each market. To
measure how the fund's performance stacked up against its peers, you
can compare the fund's performance to the European region funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Analytical Services, Inc. The past one
year average represents a peer group of 68 mutual funds. These
benchmarks include reinvested dividends and capital gains, if any, and
exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

NORDIC 26.24% 26.97%

NORDIC (INCL. 3% SALES CHARGE) 22.45% 25.05%

FT - ACTUARIES WORLD NORDIC INDEX 27.30% 24.68%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
NORDIC
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Colin Stone, Portfolio Manager of
Fidelity Nordic Fund
Q. HOW DID THE FUND PERFORM, COLIN?
A. During the 12 months that ended on October 31, 1997, the fund had a
total return of 26.24%. For the same period, the FT-Actuaries World
Nordic Index increased by 27.30%, and the Lipper European region funds
average was up 20.38%.
Q. WHAT WAS THE INVESTMENT ENVIRONMENT LIKE DURING THE YEAR?
A. We had a very good environment for European stocks in general,
including Nordic stocks. A favorable trend in interest rates,
supportive bond markets and strong money flows into the market helped
support stock prices. Corporate earnings in the Nordic markets grew
nicely, and the strong U.S. dollar helped companies that were
exporters because their products appeared less expensive on
international markets. In addition, we have seen a trend throughout
Europe, but especially in the Nordic states, for corporations to place
a greater emphasis on shareholder value. Moreover, throughout the
year, consensus estimates of economic growth have continually been
raised, and this has had a positive impact on stock prices. Given this
environment, it is not surprising that even in U.S. dollar terms, the
fund had reasonably good returns.
Q. WHAT COMPANIES HELPED CONTRIBUTE POSITIVELY TO THE FUND'S
PERFORMANCE?
A. The fund saw standout performance from a number of large, blue-chip
companies, including two major telecommunications equipment companies,
Ericsson of Sweden and Nokia of Finland, the fund's two largest
positions at the end of the period. Nokia's stock returned more than
88% during the year and Ericsson's increased by about 62%. While Nokia
and Ericsson are both known for handset cellular telephones, actually
less than half their earnings are from handsets. They also manufacture
base stations, switches and software for cellular networks. Both of
these companies have benefited from very strong growth in the cellular
telephone business worldwide. This growth is expected to continue.
Q. WHAT OTHER COMPANIES HAVE BEEN STRONG CONTRIBUTORS?
A. Den Danske Bank, the largest Danish bank, has performed very well.
Its stock returned 57% during the past year. A little more than a year
ago it acquired a major life insurance company, and this helped
improve its earnings growth significantly. Its success is part of a
larger merger and acquisition trend we are seeing in the financial
services industry throughout the Nordic region. Another large
contributor was Skandia, a Swedish insurance company that saw very
strong growth in its life insurance business, known as AFS. In
addition, Skandia established a large presence in the U.S. variable
annuity business, with very substantial asset growth over the past two
to three years. The company uses a number of leading external money
managers, including Fidelity. Skandia provides the software to help
independent financial advisers structure variable annuity products for
their clients. In addition, it offers outstanding service to its
customers. This stock returned 67% during the past year. Another good
performer was Volvo, which did a fabulous job of turning from a
conglomerate to a company focused on its core truck and auto
businesses. Volvo is now one of the top three heavy truck
manufacturers outside the United States. It also has turned the
perception of its car business from "safe, but boring" into
"interesting, but safe" and has brought to market a number of
attractive new cars. The car business has been surprising in terms of
its profitability. This stock had a 26% return for the year.
Q. YOU MENTIONED THE MERGERS AND ACQUISITION TREND AMONG FINANCIAL
INSTITUTIONS. AT 17.6% OF THE FUND'S INVESTMENTS, FINANCE REPRESENTED
A MAJOR INDUSTRY WEIGHTING AT THE END OF THE FISCAL YEAR. WHY DID YOU
HAVE THIS EMPHASIS?
A. We have witnessed a huge merger and acquisition trend among
financial institutions in the Nordic region, including mergers among
banks headquartered in different countries, bank-insurance mergers and
banks merging with each other to reduce costs. This trend has had a
very good effect on stock values, and I expect this trend to continue.
Starting a year ago, Nordic financials were priced very cheaply
compared to other European financials. Even after a year of good
performance, they still are attractively priced, offering a very good
return on equity.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. The small- and mid-capitalization stock area was disappointing, as
it was in the United States. It has been a liquidity-driven market,
with investors seeking out the largest, most actively traded stocks.
Many blue chip stocks, such as Ericsson and Nokia, had outstanding
performance. However, it was not a positive environment for small-cap
stocks. The fund's small- and mid-cap weighting was one of the reasons
the fund's performance trailed that of the benchmark FT-Actuaries
World Nordic Index, which is heavily weighted in large-capitalization
stocks. In addition, the fund also had disappointing investments in
Nera, a Norwegian telecommunications equipment company, and Frontec, a
Swedish software company. The fund held neither stock by the end of
the fiscal year. In addition, although the fund was underweighted in
relation to the market index in Astra, the Swedish pharmaceutical
company, that stock still had poor performance. There were some
investor concerns about the patent expiring on its biggest selling
drug, and European sales growth of the anti-ulcer drug, known as
Prilosec, was less than expected.
Q. WHAT IS YOUR OUTLOOK?
A. I have an optimistic outlook, although the investment environment
may not be as positive as it was 12 months ago. There is a lot of
uncertainty in the global markets, with concern about what will happen
in the Japanese market and about what will happen to interest rates in
the United States. At the same time, Europe looks very good, with
accelerating economic growth and a favorable outlook for corporate
earnings. I see no compelling reason for short-term interest rates to
increase significantly. Nordic stocks have done very well for the past
year, but they still appear attractive in relation to bonds with their
relatively low yields. I expect the merger and acquisition trend to
continue in financial services and other industries. It is still
possible to construct a very good portfolio with many sound ideas.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

COLIN STONE ON THE RISE OF SWEDEN'S ERICSSON AND
FINLAND'S NOKIA AS TWO OF THE LEADING
TELECOMMUNICATIONS EQUIPMENT COMPANIES IN THE
WORLD:
"The Nordic countries in general have adopted new
technology very quickly. Market-penetration rates for
personal computers and the Internet in the region are
among the highest in the world. To illustrate, mobile
phones in Finland have about 35% market penetration,
and the usage also is extremely high in Sweden, Norway
and Denmark. It should be no surprise that the Nordic
region would give birth to two of the world's major
equipment companies. We've seen a period of substantial
industry growth throughout the world, with the exception
of the U.S., where growth in cellular communications has
lagged. Both these companies now have brand names
recognized throughout the world. Ericsson, for example,
purchased the rights to have a National Football League
Stadium named after it in North Carolina. As an indication
of the size of these companies, I would point out that even
though almost 10% of the fund's assets was invested in
Ericsson at the end of the period, the holding still was
underweighted in relation to the market index.
"As demand for cellular communications grows throughout
Europe, the Middle East and Asia, the growth projections
of this industry have increased almost continually. We have
seen a series of constant upward earnings forecast revisions
for both Ericsson and Nokia during the past year."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of issuers in Denmark,
Finland, Norway and Sweden
FUND NUMBER: 342
TRADING SYMBOL: FNORX
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$73 million
MANAGER: Colin Stone, since inception; manager,
Fidelity Europe Open Fund, since June 1996;
Fidelity New Europe Fund, from October 1994
to May 1997; Fidelity Select Energy Service
Portfolio, 1989; Fidelity International, Limited's
Fidelity Nordic Fund, since 1990, Fidelity Iberia
Fund, 1993-1996; Fidelity European Small
Cap Fund, since 1996; analyst covering oil,
oil service, leisure and engineering industries
and German market, 1987-1993; joined
Fidelity in 1987
(checkmark)
NORDIC
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 6.5%
ROW: 1, COL: 1, VALUE: 11.7
ROW: 1, COL: 2, VALUE: 24.2
ROW: 1, COL: 3, VALUE: 1.1
ROW: 1, COL: 4, VALUE: 4.5
ROW: 1, COL: 5, VALUE: 52.0
ROW: 1, COL: 6, VALUE: 6.5
DENMARK 11.7%
SWEDEN 53.0%
FINLAND 24.2%
NETHERLANDS 0.1%
NORWAY 4.5%
AS OF APRIL 30, 1997
UNITED STATES 6.3%
DENMARK 10.9%
ROW: 1, COL: 1, VALUE: 6.3
ROW: 1, COL: 2, VALUE: 55.1
ROW: 1, COL: 3, VALUE: 5.7
ROW: 1, COL: 4, VALUE: 22.0
ROW: 1, COL: 5, VALUE: 10.9
FINLAND 22.0%
NORWAY 5.7%
SWEDEN 55.1%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 94.5 94.8

SHORT-TERM INVESTMENTS 5.5 5.2

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

ERICSSON (L.M.) TELEPHONE CO. CLASS B 9.3 9.5
(SWEDEN, COMMUNICATIONS EQUIPMENT)

NOKIA CORP. AB, SERIES A 8.1 6.5
(FINLAND, COMMUNICATIONS EQUIPMENT)

ASTRA AB CLASS A FREE SHARES 6.9 8.9
(SWEDEN, DRUGS & PHARMACEUTICALS)

ABB AB, SERIES A 3.2 5.0
(SWEDEN, HOLDING COMPANIES)

VOLVO AB CLASS B 3.1 4.5
(SWEDEN, AUTOS, TIRES & ACCESSORIES)

SWEDBANK CLASS A 2.7 1.6
(SWEDEN, BANKS)

DEN DANSKE BANK GROUP AS 2.7 3.6
(DENMARK, BANKS)

SVENSKA HANDELSBANKEN 2.5 3.9
(SWEDEN, BANKS)

UPM-KYMMENE CORP. 2.5 3.0
(FINLAND, PAPER & FOREST PRODUCTS)

SKANDIA FOERSAEKRINGS AB 2.0 2.0
(SWEDEN, INSURANCE)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

TECHNOLOGY 23.4 23.1

FINANCE 17.6 19.2

HEALTH 10.8 12.0

BASIC INDUSTRIES 10.0 7.2

DURABLES 7.5 7.3

MEDIA & LEISURE 5.4 3.5

CONSTRUCTION & REAL ESTATE 5.3 5.5

HOLDING COMPANIES 4.3 5.3

NONDURABLES 2.8 4.6

RETAIL & WHOLESALE 2.8 0.0

NORDIC
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 94.5%
SHARES VALUE (NOTE 1)
DENMARK - 11.7%
Broendby IF Class B (a) 4,050 $ 271,460
Den Danske Bank Group AS 17,429 1,964,728
Incentive AS 9,878 507,104
NKT Holding AS 8,200 690,776
Novo-Nordisk AS Class B 6,400 692,208
Radiometer AS Class B 9,000 383,883
Sophus Berendsen AS, Series B 4,590 692,223
Sondagsavisen AS (Reg.) 17,400 821,692
Scanbox Danmark AS Class B (a) 8,300 309,772
Spar Nord Holding 12,500 751,200
Syd-Sonderjylland Holding 17,400 901,211
Unidanmark AS Class A 4,467 301,452
William Demant Holding 8,250 384,569
8,672,278
FINLAND - 24.2%
Asko Class A 28,800 544,970
Cultor OY, Series 1 13,542 692,919
Enso OY Class R 72,100 682,159
Fiskars OY, Series A 2,800 302,761
Hartwall OY AB Class A 10,013 821,689
Huhtamaki Ord. 6,119 251,660
Martela OY Class A 16,500 366,383
Merita Ltd. Class A 136,100 664,864
Metsa-Serla Ltd. Class B 82,400 731,879
Nokia Corp. AB, Series A 68,990 6,021,139
Okobank Class A 27,700 451,950
Outokumpu OY Class A 23,400 350,164
Pohjola Class B 25,051 967,407
Rauma OY 35,197 662,620
Raisio Group PLC 3,050 323,904
Spontel OY Class A 30,000 185,364
Talentum OY Class B 38,000 418,227
TT Teito OY 9,249 1,035,624
UPM-Kymmene Corp. 80,600 1,813,072
Yit-Yhtymae OY 45,300 577,293
17,866,048
NETHERLANDS - 0.1%
Scala Business Solutions NV (a) 9,000 69,730
NORWAY - 4.5%
A-Pressen AS, Series A 11,500 268,730
Ekornes AS (Reg.) 56,200 512,496
NCL Holdings AS (a) 262,900 1,003,921
Saga Petroleum AS Class B 3,180 56,185
Schibsted AS, Series B 33,000 615,970
SE (System Etikettering) AS (a) 4,069 58,558
Sparebanken Norway primary
shares certificates 8,117 280,467
Sparebanken Midt-Norge 5,600 182,725
Steen & Stroem ASA (a) 21,235 378,213
3,357,265
SWEDEN - 53.0%
ABB AB, Series A 200,300 2,331,393
Allgon AB Class B Free shares 41,700 665,647
Astra AB Class A Free shares 315,933 5,085,187
Assi Doman AB Free shares 23,200 648,088
Biacore International AB
sponsored ADR (a) 25,600 278,400
Biora AB sponsored ADR 41,000 804,625
Dahl International AB 24,100 442,408
Electrolux AB 12,980 1,070,515

SHARES VALUE (NOTE 1)
Ericsson (L.M.) Telephone Co. Class B 156,386 $ 6,864,966
Europolitan Holdings AB (a) 23,600 841,344
Fastighets AB Tornet 41,500 541,004
Graenges AB (Reg.) (a) 43,300 705,587
Hemkopskedjan AB, Series B (a) 63,800 657,732
Hennes & Mauritz AB Class B 34,700 1,414,772
Incentive AB Class B 12,500 1,097,439
IBS (International Business Systems) AB
Class B Free shares (a) 33,700 446,046
Kalmar Industries AB 29,500 514,067
Kalmar Industries AB redeemble
rights 12/31/97 (a) 31,400 27,568
Mo Och Domsjoe AB Class B 19,900 537,373
Munters AB (a) 20,300 205,228
Munters AB (a)(c) 9,500 96,043
NCC AB Class B Free shares 41,200 468,587
NK Cityfastigheter AB (a)(c) 13,000 96,841
Nobel Biocare AB 32,700 421,935
Nordbanken AB 40,100 1,253,542
Skandia Foersaekrings AB 32,100 1,494,513
Scandic Hotels AB (a) 21,000 474,892
Swedbank Class A 87,000 1,967,409
Spectra Physics AB Series A 35,200 950,529
SSAB Swedish Steel Class A 53,500 907,383
Stora Kopparbergs Bergslags AB
Class A Free shares 72,850 1,002,990
Svedala Industri Free shares 32,740 640,210
Svenska Handelsbanken 58,500 1,844,297
TV 4 AB Class A 5,725 92,148
Volvo AB Class B 87,378 2,278,163
39,168,871
UNITED STATES OF AMERICA - 1.0%
Autoliv, Inc. (Swedish
depository receipts) (a) 18,700 747,502
Pharmacia & Upjohn, Inc. 846 26,861
774,363
TOTAL COMMON STOCKS
(Cost $61,863,857) 69,908,555
CASH EQUIVALENTS - 5.5%
Taxable Central Cash Fund (b)
(Cost $4,058,240) 4,058,240 4,058,240
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $65,922,097) $ 73,966,795
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to $192,884
or 0.3% of net assets.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $76,872,571 and $47,178,139, respectively.
The fund placed a portion of its portfolio transactions with brokerage
firms which are affiliates of FMR. The commissions paid to these
affiliated firms were $25,958 for the period.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Basic Industries 10.0%
Cash Equivalents 5.5
Construction & Real Estate 5.3
Durables 7.5
Energy 0.1
Finance 17.6
Health 10.8
Holding Companies 4.3
Industrial Machinery & Equipment 2.5
Media & Leisure 5.4
Nondurables 2.8
Retail & Wholesale 2.8
Services 0.9
Technology 23.4
Utilities 1.1
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $65,933,481. Net unrealized appreciation
aggregated $8,033,314, of which $10,302,410 related to appreciated
investment securities and $2,269,096 related to depreciated investment
securities.
The fund hereby designates approximately $1,983,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
NORDIC
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
73,966,795
(COST $65,922,097) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD 290,855

RECEIVABLE FOR FUND SHARES SOLD 161,311

DIVIDENDS RECEIVABLE 3,428

INTEREST RECEIVABLE 10,302

REDEMPTION FEES RECEIVABLE 4

TOTAL ASSETS
74,432,695

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 779,625

PAYABLE FOR FUND SHARES REDEEMED 252,119

ACCRUED MANAGEMENT FEE 49,022

OTHER PAYABLES AND 74,189

ACCRUED EXPENSES

TOTAL LIABILITIES
1,154,955

NET ASSETS $
73,277,740

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
57,887,055

UNDISTRIBUTED NET INVESTMENT INCOME 436,258

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
6,909,609

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
8,044,818
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 4,596,252 $
73,277,740
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($73,277,740 (DIVIDED BY) 4,596,252 SHARES) $15.94

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $15.94) $16.43

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 1,463,636
DIVIDENDS

INTEREST 170,924

1,634,560

LESS FOREIGN TAXES WITHHELD (203,518)

TOTAL INCOME 1,431,042

EXPENSES

MANAGEMENT FEE $ 510,905

TRANSFER AGENT FEES 216,031

ACCOUNTING FEES AND EXPENSES 60,492

NON-INTERESTED TRUSTEES' COMPENSATION 283

CUSTODIAN FEES AND EXPENSES 94,715

REGISTRATION FEES 41,213

AUDIT 34,357

LEGAL 329

REPORTS TO SHAREHOLDERS 12,358

MISCELLANEOUS 465

TOTAL EXPENSES BEFORE REDUCTIONS 971,148

EXPENSE REDUCTIONS (458) 970,690

NET INVESTMENT INCOME 460,352

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 6,932,562

FOREIGN CURRENCY TRANSACTIONS (10,373) 6,922,189

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 5,718,004

ASSETS AND LIABILITIES IN 124 5,718,128
FOREIGN CURRENCIES

NET GAIN (LOSS) 12,640,317

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 13,100,669

OTHER INFORMATION $ 348,689
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 458
CUSTODIAN CREDITS

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS TO
OCTOBER 31,
1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 460,352 $ 145,269
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 6,922,189 294,221

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 5,718,128 2,326,690

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 13,100,669 2,766,180

DISTRIBUTIONS TO SHAREHOLDERS (148,633) -
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (297,267) -

TOTAL DISTRIBUTIONS (445,900) -

SHARE TRANSACTIONS 91,413,026 32,616,632
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 444,929 -

COST OF SHARES REDEEMED (62,246,049) (4,541,434)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 29,611,906 28,075,198

REDEMPTION FEES 140,469 29,218

TOTAL INCREASE (DECREASE) IN NET ASSETS 42,407,144 30,870,596

NET ASSETS

BEGINNING OF PERIOD 30,870,596 -

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $436,258 AND $143,841,
RESPECTIVELY) $ 73,277,740 $ 30,870,596

OTHER INFORMATION
SHARES

SOLD 6,327,627 2,814,140

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 33,555 -

REDEEMED (4,182,354) (396,716)

NET INCREASE (DECREASE) 2,178,828 2,417,424

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 12.77 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME C .10 .17 D

NET REALIZED AND UNREALIZED GAIN (LOSS) 3.19 2.57

TOTAL FROM INVESTMENT OPERATIONS 3.29 2.74

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.05) -

FROM NET REALIZED GAIN (.10) -

TOTAL DISTRIBUTIONS (.15) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .03 .03

NET ASSET VALUE, END OF PERIOD $ 15.94 $ 12.77

TOTAL RETURN A, B 26.24% 27.70%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 73,278 $ 30,871

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.42% 2.00% E

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS .67% 1.52%

PORTFOLIO TURNOVER RATE 74% 35%

AVERAGE COMMISSION RATE F $ .0485 $ .0523

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN. B TOTAL RETURNS DO NOT
INCLUDE THE ONE TIME SALES CHARGE. C NET INVESTMENT INCOME PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD. D INVESTMENT INCOME PER
SHARE REFLECTS SPECIALS DIVIDENDS WHICH AMOUNTED TO $.16 PER SHARE.
E FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE
FUND'S EXPENSE RATIO WOULD HAVE BEEN HIGHER. F A FUND IS REQUIRED
TO DISCLOSE ITS AVERAGE COMMISSION RATE PER SHARE FOR SECURITY
TRADES ON WHICH COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY
FROM PERIOD TO PERIOD AND FUND TO FUND DEPENDING ON THE
MIX OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING PRACTICES
AND COMMISSION RATE STRUCTURES MAY DIFFER.

</TABLE>

PACIFIC BASIN
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the past five year and past 10
year total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

PACIFIC BASIN -7.97% 31.03% 35.92%

PACIFIC BASIN -10.73% 27.10% 31.85%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -19.63% 19.60% 3.34%
INTERNATIONAL PACIFIC INDEX

PACIFIC REGION FUNDS AVERAGE -18.52% 29.45% 84.05%

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Morgan Stanley Capital International (MSCI) Pacific Index - a market
capitalization weighted index of over 400 stocks traded in six
Pacific-region markets. To measure how the fund's performance stacked
up against its peers, you can compare it to the Pacific region funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Analytical Services, Inc. The past one
year average represents a peer group of 41 mutual funds. These
benchmarks include reinvested dividends and capital gains, if any, and
exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 PAST 5 PAST 10
OCTOBER 31, 1997 YEAR YEARS YEARS

PACIFIC BASIN -7.97% 5.55% 3.12%

PACIFIC BASIN -10.73% 4.91% 2.80%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -19.63% 3.64% 0.33%
INTERNATIONAL PACIFIC INDEX

PACIFIC REGION FUNDS AVERAGE -18.52% 5.18% 5.90%

AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19971031 19971113 155735 S00000000000001
Pacific Basin MS Pacific Index (Net)
00302 MS003
1987/10/31 9700.00 10000.00
1987/11/30 9926.49 10397.04
1987/12/31 10670.08 10556.78
1988/01/31 10670.08 11084.89
1988/02/29 11112.04 11862.48
1988/03/31 11727.62 12786.55
1988/04/30 12161.68 12948.26
1988/05/31 11727.62 12454.10
1988/06/30 11056.79 12030.80
1988/07/31 10843.71 12577.32
1988/08/31 10804.24 11646.33
1988/09/30 10962.09 12096.01
1988/10/31 11041.01 13090.25
1988/11/30 11751.29 14170.56
1988/12/31 11784.59 14250.88
1989/01/31 12007.25 14381.91
1989/02/28 12269.66 14565.69
1989/03/31 11983.39 14103.08
1989/04/30 12293.51 14111.41
1989/05/31 11816.40 13322.92
1989/06/30 11267.73 12728.93
1989/07/31 12611.58 14380.87
1989/08/31 11935.68 13491.15
1989/09/30 12921.70 14315.70
1989/10/31 12547.97 13932.55
1989/11/30 12953.51 14595.83
1989/12/31 13132.98 14611.69
1990/01/31 12686.11 13784.96
1990/02/28 11891.68 12447.14
1990/03/31 11155.17 10205.66
1990/04/30 11031.04 10274.34
1990/05/31 12098.56 11701.52
1990/06/30 12280.62 11230.08
1990/07/31 12694.39 11144.81
1990/08/31 11006.22 10081.66
1990/09/30 9210.47 8501.05
1990/10/31 10666.93 10337.62
1990/11/30 9690.44 9191.26
1990/12/31 9559.06 9582.51
1991/01/31 9743.53 9881.16
1991/02/28 10623.97 11099.28
1991/03/31 10489.81 10494.66
1991/04/30 10942.61 10764.36
1991/05/31 10867.14 10722.69
1991/06/30 10682.67 10021.99
1991/07/31 10816.83 10360.00
1991/08/31 10087.32 9834.47
1991/09/30 10716.21 10608.10
1991/10/31 11026.46 11059.54
1991/11/30 10506.58 10348.03
1991/12/31 10758.13 10665.59
1992/01/31 10481.42 10252.34
1992/02/29 10380.80 9534.28
1992/03/31 9726.76 8627.54
1992/04/30 9626.14 8232.05
1992/05/31 10397.57 8874.10
1992/06/30 10179.56 8176.28
1992/07/31 9726.76 8062.62
1992/08/31 10011.86 9167.16
1992/09/30 9944.78 8957.11
1992/10/31 10062.17 8640.86
1992/11/30 10020.24 8803.82
1992/12/31 9938.56 8703.05
1993/01/31 10040.15 8686.85
1993/02/28 10624.27 9108.02
1993/03/31 11343.84 10208.31
1993/04/30 12495.16 11834.71
1993/05/31 13104.68 12179.01
1993/06/30 12427.43 11979.34
1993/07/31 13087.75 12687.58
1993/08/31 13688.80 13062.85
1993/09/30 13722.66 12574.29
1993/10/31 14797.79 12853.45
1993/11/30 14069.75 11039.92
1993/12/31 16290.16 11809.51
1994/01/31 16732.07 13176.52
1994/02/28 16896.71 13516.21
1994/03/31 15631.62 12770.10
1994/04/30 16064.87 13322.28
1994/05/31 16541.45 13639.21
1994/06/30 16472.13 14085.38
1994/07/31 16437.47 13783.18
1994/08/31 17217.31 14022.73
1994/09/30 16992.02 13671.75
1994/10/31 17295.30 14017.57
1994/11/30 15874.24 13235.36
1994/12/31 15831.90 13324.41
1995/01/31 14365.08 12482.94
1995/02/28 14130.39 12173.78
1995/03/31 14580.21 13108.42
1995/04/30 14746.45 13665.94
1995/05/31 14658.44 13119.32
1995/06/30 14521.54 12563.33
1995/07/31 15470.08 13469.13
1995/08/31 15303.84 12961.77
1995/09/30 15127.82 13081.84
1995/10/31 14550.87 12445.73
1995/11/30 14423.75 13057.66
1995/12/31 14863.80 13694.98
1996/01/31 15088.71 13718.21
1996/02/29 14766.01 13563.41
1996/03/31 15157.16 13979.40
1996/04/30 15959.02 14691.25
1996/05/31 15509.20 14053.73
1996/06/30 15714.55 14056.64
1996/07/31 14912.69 13410.73
1996/08/31 14619.33 13057.67
1996/09/30 15049.59 13483.81
1996/10/31 14325.96 12857.89
1996/11/30 14873.58 13207.01
1996/12/31 14452.93 12520.55
1997/01/31 13558.22 11467.57
1997/02/28 13843.35 11707.24
1997/03/31 13469.74 11278.76
1997/04/30 13902.34 11514.14
1997/05/31 15327.97 12641.49
1997/06/30 16045.70 13425.26
1997/07/31 16458.64 13105.21
1997/08/31 14462.76 11806.22
1997/09/30 14816.71 11761.71
1997/10/31 13184.61 10334.43
IMATRL PRASUN SHR__CHT 19971031 19971113 155739 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity Pacific Basin Fund on October 31, 1987, and the
current 3% sales charge was paid. As the chart shows, by October 31,
1997, the value of the investment would have grown to $13,185 - a
31.85% increase on the initial investment. For comparison, look at how
the Morgan Stanley Capital International Pacific Index did over the
same period. With dividends and capital gains, if any, reinvested, the
same $10,000 would have grown to $10,334 - a 3.34% increase.

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
PACIFIC BASIN
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Shigeki Makino, Portfolio Manager
of Fidelity Pacific Basin Fund
Q. HOW DID THE FUND PERFORM, SHIGEKI?
A. For the 12 months that ended October 31, 1997, the fund was down
7.97%. By way of comparison, the Morgan Stanley Capital International
Pacific Index was down 19.63% and the Lipper Pacific region funds
average was down 18.52%.
Q. WHY WAS THE FUND ABLE TO OUTPERFORM THE INDEX OVER THE PERIOD?
A. In large part, it was due to careful selection of Japanese stocks,
which constituted approximately 70% of the fund's portfolio. I tried
to concentrate on stocks that have higher returns on capital and
higher profit margins, are globally competitive, and have reasonable
valuations compared to alternatives in the region. Some examples are
Honda, Toyota, Sony and Canon. The fund also had a heavier weighting
in Australian stocks than the index did. The same was true of the
fund's position in Hong Kong equities until mid-September or so. All
of these factors helped the fund relative to the index.
Q. DID THE FUND OUTPERFORM THE LIPPER AVERAGE FOR THE SAME REASONS?
A. Actually, the story was a little different there. The funds that
make up the average invested a substantially lower percentage of their
assets in Japan than I did, and that was a drag on their performance.
Q. AT THE SAME TIME, THE FUND'S RETURN WAS NEGATIVE. IS THAT BECAUSE
OF THE RECENT TURMOIL IN THE PACIFIC BASIN?
A. There's no question that the fund's performance was affected by
those events. The October crisis in Hong Kong was the most recent
manifestation of a series of events that began in July, when the
monetary authorities in Thailand allowed the value of the currency to
fluctuate freely on world markets instead of maintaining a fixed
exchange rate with the U.S. dollar. The fund did not have any
investments in Thailand at the time, but the resulting loss of
confidence in Asian currencies was felt immediately throughout the
region, and is still being felt there.
Q. WHAT HAPPENED IN MID-SEPTEMBER THAT CAUSED YOU TO LIGHTEN UP ON
HONG KONG STOCKS?
A. I noticed several things. First of all, the Hong Kong current
account - a measure of its balance of trade with the rest of the world
- - began running a deficit, indicating that Hong Kong goods and
services were less competitive. Second, the Hong Kong money supply
figures turned negative, which meant that there was less liquidity in
the economy. There also was increasing speculation in Chinese stocks,
which I took as a possible sign of a market top. At that point, I
began to reduce the fund's exposure to Hong Kong. As a defensive
maneuver, I increased the fund's cash holdings. Within Hong Kong, I
also tried to shift assets away from the property and conglomerate
areas and into companies that had some kind of global competitive edge
and some pricing power even in an environment where prices were
falling.
Q. WHAT STOCKS PERFORMED WELL FOR THE FUND?
A. Orix Corp., which provides leasing and rental services for small
and mid-sized companies worldwide, performed extremely well. The
company and its stock benefited from a combination of factors. The
ongoing deregulation of the Japanese financial industry allowed Orix
to finance its leasing activities at lower rates by issuing
medium-term bonds and commercial paper instead of borrowing from
banks. In addition, Japanese interest rates fell, further cutting the
company's borrowing costs.
Q. ARE THERE ANY OTHER STOCKS YOU'D LIKE TO MENTION THAT HELPED THE
FUND'S PERFORMANCE?
A. I'll mention two others. Takeda Chemical is the premier
pharmaceutical company in Japan. Its research and development
activities have resulted in a strong pipeline of products for the next
three or four years. The state of the firm's current business is also
very good due to recent reductions in labor and other costs. This
aggressive cost-cutting program has enabled the company to increase
sales without increasing operating costs. The other stock I'll mention
is Toyota. The company has been extremely aggressive in cutting costs,
to the tune of $1 billion per year, and is about to enter a good new
product cycle. Furthermore, since a big percentage of the company's
revenues come from exporting, a weaker yen relative to the dollar has
been good for business. In that kind of environment, even if sales
remain static in U.S. dollar terms, yen-denominated sales increase.
Q. WHAT STOCKS WERE DISAPPOINTMENTS?
A. The Japanese banking sector as a whole did poorly. To begin with,
these stocks were selling at high valuations, and there was an
implicit guarantee that banks and finance companies would not fail.
That illusion was destroyed by several noteworthy bankruptcies that
scared many investors away from even the sound companies. Second, the
"convoy system," by which sound Japanese companies bail out their
troubled brethren, began to break down. In addition, banks had
substantial assets invested in the equity markets, which went down
during the period. The general credit problems in Asia also made
people less willing to invest in financial services companies. Some
examples of stocks that pulled down the fund's performance were Sakura
Bank, Fuji Bank, Mitsui Trust & Banking Co. and Bank of
Tokyo-Mitsubishi.
Q. WHAT'S YOUR OUTLOOK, SHIGEKI?
A. The outlook for the region is problematic right now. Because of the
way the fund is structured, it's helpful to break the analysis into
two parts: Japan, and the rest of the Pacific Basin. Japan is making
the transition to a deregulated economy. In the long term, this is a
very positive development that will help separate the good companies
from the bad. In the short term, the country must cope with sluggish
economic growth, a weak yen and competition for sales from other
Pacific Basin countries with weak currencies. As pointed out
previously, Japanese companies that are active exporters derive some
benefit from yen weakness. However, the valuations of these companies
tend to be high because so many investors have flocked to them as a
kind of safe haven. It is questionable how much upside potential is
left in many of them. Elsewhere in the Pacific Basin, Australia still
shows promise. The country is undergoing an economic recovery,
valuations are reasonable and the companies generally are well run.
However, it's difficult to find opportunity elsewhere. The Hong Kong
situation is very precarious, with continuing pressure on the Hong
Kong dollar's fixed exchange rate with the U.S. dollar. Basically,
it's a no-win situation: They can let the currency trade freely on
world markets, which will devalue Hong Kong dollar-denominated
investments, or attempt to maintain a fixed exchange rate. That will
be extremely costly and, I suspect, ultimately impractical, as
Thailand discovered. Currently, the upward spike in interest rates is
choking off the Hong Kong economy, which is so sensitive to interest
rates because of its concentration of financial services and property
companies. Malaysia and Singapore, like many other countries in the
area, are afflicted with weak currencies and offer limited investment
opportunities right now. It will take a while for these things to sort
themselves out.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

SHIGEKI MAKINO ON THE RECENT VOLATILITY IN THE PACIFIC
BASIN:
"A `domino effect' was set in motion back in July when
the value of the Thai baht was allowed to fluctuate freely
on world markets. The Thai government had spent a huge
percentage of the country's gross domestic product to
maintain a fixed exchange rate between the baht and
the U.S. dollar, but ultimately it became too expensive to
continue propping up the baht. Before that, people felt
they weren't taking much of a currency risk with Asian
investments. That perception changed dramatically
when the baht was cut loose.
"A rapid succession of events followed. The baht depreciated
dramatically against the U.S. dollar and most other currencies.
Investors outside of Thailand who had money invested there
immediately experienced huge drops in equity because their
investments were worth much less in their native currencies.
"Within weeks, the Philippine peso was also allowed to
trade freely or `float.' The peso, the Indonesian rupiah,
and the Malaysian ringgit, which was already floating, all
came under increasing pressure and depreciated by large
amounts. To make things worse, those countries are net
importers, so they were hurt more by currency depreciation
than a net exporter country like Japan. Imports become
more expensive when a country's currency depreciates
relative to that of a trading partner.
"All of this began to bring pressure on the Hong Kong dollar
in September and especially October. Increasing skepticism
about the Hong Kong dollar-U.S. dollar exchange rate began
to drive up Hong Kong interest rates, as investors demanded
higher returns to compensate for the perceived greater risk
of investing in Hong Kong dollar-denominated investments.
Rapidly rising rates destabilized an already delicate Hong
Kong economy and caused a rapid slide in share prices.
"We have probably not seen the end of the problems in
the Pacific Basin. As I mentioned earlier, Hong Kong is
fighting the same battle Thailand fought - to maintain a
fixed exchange rate with the U.S. dollar. It's very difficult
for two countries to maintain fixed exchange rates indefinitely
when they have substantially differing rates of monetary
growth and price inflation, as is the case with Hong Kong and
the United States. There is constant downward pressure on
the value of the currency of a country with higher money
supply growth and inflation rates - in this case, Hong Kong.
To relieve the pressure, Hong Kong must buy its currency
from other countries on world markets, which can be very
expensive over the long term.
"There are still worthwhile investment opportunities in
the Pacific Basin - certainly in Australia and to some
degree elsewhere in the region - but selectivity is the
watchword for now."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of Pacific Basin issuers
FUND NUMBER: 302
TRADING SYMBOL: FPBFX
START DATE: October 1, 1986
SIZE: as of October 31, 1997, more than
$239 million
MANAGER: Shigeki Makino, since 1996; manager,
Fidelity Japan Fund, since 1994; analyst, Fidelity
Japan Fund, 1993-1994; joined Fidelity in 1990
(checkmark)
PACIFIC BASIN
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED STATES 6.6%
SINGAPORE 1.9%
AUSTRALIA 9.9%
ROW: 1, COL: 1, VALUE: 6.6
ROW: 1, COL: 2, VALUE: 1.9
ROW: 1, COL: 3, VALUE: 2.2
ROW: 1, COL: 4, VALUE: 2.2
ROW: 1, COL: 5, VALUE: 71.40000000000001
ROW: 1, COL: 6, VALUE: 5.8
ROW: 1, COL: 7, VALUE: 9.9
OTHER 2.2%
HONG KONG 5.8%
MALAYSIA 2.2%
JAPAN 71.4%
AS OF APRIL 30, 1997
UNITED STATES 4.1%
SINGAPORE 3.6%
AUSTRALIA 10.4%
OTHER 1.1%
ROW: 1, COL: 1, VALUE: 4.1
ROW: 1, COL: 2, VALUE: 3.6
ROW: 1, COL: 3, VALUE: 1.1
ROW: 1, COL: 4, VALUE: 5.5
ROW: 1, COL: 5, VALUE: 64.2
ROW: 1, COL: 6, VALUE: 11.1
ROW: 1, COL: 7, VALUE: 10.4
MALAYSIA 5.5%
HONG KONG 11.1%
JAPAN 64.2%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS AND EQUITY FUTURES 92.9 94.9

BONDS 0.5 1.0

SHORT-TERM INVESTMENTS 6.6 4.1

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

TOYOTA MOTOR CORP. 2.7 5.6
(JAPAN, AUTOS, TIRES, & ACCESSORIES)

MATSUSHITA ELECTRIC INDUSTRIAL CO. LTD. 2.4 2.4
(JAPAN, CONSUMER ELECTRONICS)

NATIONAL AUSTRALIA BANK LTD. 2.0 1.6
(AUSTRALIA, BANKS)

HONDA MOTOR CO. LTD. 1.9 1.7
(JAPAN, AUTOS, TIRES, & ACCESSORIES)

ACOM CO. LTD. 1.8 1.1
(JAPAN, CREDIT & OTHER FINANCE)

CANON, INC. 1.8 2.7
(JAPAN, COMPUTERS & OFFICE EQUIPMENT)

ROHM CO. LTD. 1.8 1.1
(JAPAN, ELECTRONICS)

ORIX CORP. 1.7 1.3
(JAPAN, LEASING & RENTAL)

TAKEDA CHEMICAL INDUSTRIES LTD. 1.7 1.9
(JAPAN, DRUGS & PHARMACEUTICALS)

OMRON CORP. 1.7 1.6
(JAPAN, ELECTRICAL EQUIPMENT)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

TECHNOLOGY 19.8 13.6

FINANCE 17.1 19.7

DURABLES 12.3 13.8

INDUSTRIAL MACHINERY & EQUIPMENT 8.8 8.0

HEALTH 6.9 5.5

MEDIA & LEISURE 6.6 6.8

NONDURABLES 3.7 2.6

CONSTRUCTION & REAL ESTATE 3.7 8.2

SERVICES 3.6 2.9

UTILITIES 2.7 4.7

PACIFIC BASIN
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 91.5%
SHARES VALUE (NOTE 1)
AUSTRALIA - 9.4%
Australia & New Zealand Banking
Group Ltd. 287,327 $ 1,998,191
Brambles Industries Ltd. 79,647 1,526,571
Broken Hill Proprietary Co. Ltd. (The) 160,600 1,587,500
CSR Ltd. 408,000 1,413,266
Goodman Fielder Ltd. Ord. 680,728 1,040,349
Harvey Norman Holdings Ltd. 153,197 971,959
Harvey Norman Holdings Ltd.
rights 11/21/97 (a) 6,127 5,154
Leighton Holdings Ltd. 283,000 1,041,585
Macquarie Bank Ltd. 118,300 912,276
Mirvac Ltd. 30,065 48,899
Mirvac Ltd. rights 10/20/97 (a) 11,353 2,706
National Australia Bank Ltd. 344,873 4,702,489
National Mutual Holdings Ltd. 665,236 1,142,591
Normandy Mining Ltd. 730,000 793,238
North Ltd. 209,600 547,793
Tabcorp Holdings Ltd. 416,000 1,901,472
Woodside Petroleum Ltd. 280,161 2,358,846
Woolworths Ltd. 183,000 588,861
22,583,746
HONG KONG - 5.8%
Asia Satellite Telecommunications
Holdings Ltd. 150,000 360,931
ASM Pacific Technology Ltd. 902,000 676,792
Cheung Kong Holdings Ltd. 218,000 1,515,847
Four Seas Mercantile Holdings Ltd. 1,702,000 902,743
Hong Kong & China Gas Co. Ltd. 1,351,360 2,552,375
Hutchison Whampoa Ltd. Ord. 272,000 1,882,536
JCG Holdings Ltd. 912,000 404,088
Johnson Electric Holdings Ltd. 480,000 1,310,220
South China Morning Post Holdings 1,072,000 929,159
Sun Hung Kai Properties Ltd. 205,000 1,511,643
Television Broadcast Ltd. Ord. 407,000 1,132,018
Yue Yuen Industrial Holdings Ltd. 372,000 813,299
13,991,651
INDONESIA - 0.3%
PT Tambank Timah (For. Reg.) 500,000 597,223
PT Putra Surya Multidana (For. Reg.) (a) 143,500 49,826
647,049
JAPAN - 70.0%
Acom Co. Ltd. 80,400 4,407,309
Aderans Co. Ltd. 50,000 1,345,515
Aiwa Co. Ltd. 30,000 670,266
Akita Bank Ltd. 216,000 1,210,963
Amway Japan Ltd. 55,000 1,443,522
Asahi Breweries Ltd. 140,000 2,069,767
Bank of Tokyo-Mitsubishi Ltd. 100,000 1,303,987
Banyu Pharmaceutical Co. Ltd. 100,000 1,453,488
Benesse Corp. 20,400 608,272
Canon, Inc. 180,000 4,365,449
Citizen Watch Co. Ltd. Ord. 130,000 829,236
Credit Saison Co. Ltd. 40,000 1,073,090
Daiichi Pharmaceutical Co. Ltd. 90,000 1,278,239
Daiwa House Industry Co. Ltd. 80,000 770,764
Daiwa Securities Co. Ltd. 230,000 1,390,698
Daitec Co. Ltd. 40,100 632,807
Denso Corp. 70,000 1,511,628
Fuji Bank Ltd. 230,000 1,986,711

SHARES VALUE (NOTE 1)
Fuji Photo Film Co. Ltd. 90,000 $ 3,259,136
Fujitsu Ltd. 250,000 2,740,864
Fuji Machine Manufacturing Co.
Ltd. Ord. 110,000 3,188,538
Fujitec Co. Ltd. 100,000 855,482
Heiwa Corp. 80,000 1,342,193
Hirose Electric Co. Ltd. 30,000 1,955,980
Hitachi Ltd. 385,000 2,957,849
Hitachi Maxell Ltd. 80,000 1,780,731
Honda Motor Co. Ltd. 135,000 4,541,113
Hoya Corp. 75,000 2,603,821
Ibiden Co. Ltd. 50,000 830,565
Ito-Yokado Co. Ltd. 40,000 1,986,711
Japan Aviation Electronics Industries 100,000 606,312
Komatsu Ltd. Ord. 600,000 3,204,319
Konami Industry Co. Ltd. 53,100 1,631,811
Long Term Credit Bank of Japan
Ltd. (The) 900,000 3,042,359
Matsushita Electric Industrial Co. Ltd. 350,000 5,872,093
Matsushita Communication Industrial
Co. Ltd. 80,000 2,823,920
Meitec Corp. 60,000 1,769,103
Minebea Co. Ltd. 347,000 3,458,472
Minolta Camera Co. Ltd. 300,000 1,557,309
Mirai Industry Co. Ltd. 63,000 868,605
Mitsubishi Estate Co. Ltd. 70,000 883,721
Mitsui Chemicals, Inc. (a) 202,200 671,761
Namco Ltd. 30,000 1,004,153
Nichiei Co. Ltd. 30,000 3,289,037
NGK Insulators Ltd. 330,000 2,850,498
Nintendo Co. Ltd. Ord. 40,000 3,455,150
Nippon Telegraph & Telephone
Corp. Ord. 450 3,812,292
Nitto Denko Corp. 150,000 2,703,488
Nidec Corp. 30,000 1,171,096
Nomura Securities Co. Ltd. 245,000 2,848,837
Nichicon Corp. 70,000 866,279
Okumura Gumi (a) 120,000 568,106
Omron Corp. 240,000 4,066,445
Orix Corp. 60,200 4,110,000
Paris Miki, Inc. 7,400 129,070
Riso Kagaku Corp. 35,000 2,061,047
Rohm Co. Ltd. 43,000 4,250,000
Sakura Bank Ltd. 650,000 2,650,748
Sankyo Co. Ltd. 100,000 3,297,342
Sankyo Co. Ltd. (Gunma) 55,000 1,174,003
Shimano, Inc. 100,000 2,034,884
Shin-Etsu Chemical Co. Ltd. 80,000 1,953,488
Shinko Electric Industries Co. Ltd. 25,000 1,058,970
Sony Corp. 40,500 3,360,424
Shohkoh Fund & Co. Ltd. 6,000 1,744,186
Sony Music Entertainment Japan, Inc. 36,500 1,282,351
Sumitomo Electric Industries Ltd. 50,000 660,299
Sumitomo Realty & Development Co. Ltd. 37,000 270,125
Sumitomo Metal Industries Ltd. 700,000 1,401,163
TDK Corp. 31,000 2,569,601
Takeda Chemical Industries Ltd. 150,000 4,086,379
Takefuji Corp. 30,000 1,333,057
Terumo Corp. 240,000 3,946,844
THK Co. Ltd. 121,000 1,618,023
Toyota Motor Corp. 230,000 6,399,502
Tokyo Electron Ltd. 30,000 1,495,017
Tokyo Seimitsu Co. Ltd. 50,000 1,349,668
Uni Charm Corp. Ord. 75,000 2,522,841
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
JAPAN - CONTINUED
Wako Electric Co. Ltd. 60,000 $ 802,326
Yasuda Trust & Banking 300,000 799,834
167,781,052
KOREA (SOUTH) - 0.6%
Lg Electronics, Inc. 113,900 1,534,404
Sam Yang Co. Ltd. warrants 3/6/98 (a) 300 -
1,534,404
MALAYSIA - 2.2%
Amway Holding BHD 184,000 362,507
Berjaya Sports Toto BHD 495,000 1,344,627
Carlsberg Brewery BHD 120,000 429,851
Magnum Corp. BHD 354,500 276,193
Oriental Holdings BHD 114,200 231,809
Oriental Holdings BHD (New) 68,520 137,347
Petronas Dagangan BHD (a) 209,000 290,728
RJ Reynolds BHD 400,000 614,925
Resorts World BHD 200,000 355,224
Rothmans of Pall Mall Malaysia BHD 144,000 1,149,871
5,193,082
NEW ZEALAND - 0.4%
Lion Nathan Ltd. 380,800 919,229
Lion Nathan Ltd. (Astl.) 9,500 22,977
942,206
PAKISTAN - 0.0%
Bank of Punjab (a) 1,800 845
PHILIPPINES - 0.0%
Oriental Petroleum & Mineral Corp.
Class B (a) 7,771,657 1,322
SINGAPORE - 1.9%
City Developments Ltd. 120,000 503,497
Clipsal Industries Ltd. 128,000 331,520
Datacraft Asia Ltd. 257,000 585,960
DBS Land Ltd. 189,000 322,009
Elec & Eltek International Co. Ltd. 67,000 482,400
GP Batteries International Ltd. 112,000 327,527
Parkway Holdings Ltd. 44,000 111,329
Singapore International Airlines Ltd. 84,000 630,134
Singapore Press Holdings Ltd. (For. Reg.) 35,000 482,835
United Overseas Bank Ltd. (For. Reg.) 121,000 669,231
Want Want Holdings Ltd. (a) 78,000 156,000
Want Want Holdings Ltd. (New) (a) 31,400 60,916
4,663,358
TAIWAN - 0.1%
Taiwan Semiconductior Manufacturing
Co. sponsored ADR 10,800 213,975
UNITED KINGDOM - 0.8%
HSBC Holdings PLC 82,626 1,935,845
TOTAL COMMON STOCKS
(Cost $220,936,832) 219,488,535
NONCONVERTIBLE PREFERRED STOCKS - 0.5%
SHARES VALUE (NOTE 1)
AUSTRALIA - 0.5%
Sydney Harbour Casino Holdings Ltd. (a)
(Cost $1,862,607) 1,219,400 $ 1,239,547
CONVERTIBLE BONDS - 0.5%
MOODY'S RATINGS PRINCIPAL
(UNAUDITED) AMOUNT
JAPAN - 0.5%
MBL International Finance of
Bermuda 3%, 11/30/02
(Cost $1,126,575) Aa2 $ 1,080,000 1,104,300
GOVERNMENT OBLIGATIONS - 0.0%
UNITED STATES OF AMERICA - 0.0%
U.S. Treasury Bill, yield at date of
purchase 5.30%, 1/8/98 (c)
(Cost $123,759) 125,000 123,813
CASH EQUIVALENTS - 7.5%
SHARES
Taxable Central Cash Fund (b)
(Cost $17,884,686) 17,884,686 17,884,686
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $241,934,459) $ 239,840,881
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
27 Nikkei 225 Stock
Index Contracts Dec. 97 $2,215,350 $ (296,343)
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL
INVESTMENTS IN SECURITIES - 0.9%
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security was pledged to cover margin requirements for futures
contracts. At the period end, the value of securities pledged amounted
to $123,813.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $143,522,872 and $463,864,130 respectively. The market
value of futures contracts opened and closed during the period
amounted to $7,998,372 and $5,278,068, respectively.
The fund participated in the bank borrowing program. The maximum loan
and average daily balances during the period for which loans were
outstanding amounted to $10,161,000 and $3,611,521, respectively. The
weighted average interest rate was 5.63% (see Note 6 of Notes to
Financial Statements).
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Basic Industries 2.6%
Cash Equivalents 7.5
Construction & Real Estate 3.7
Durables 12.3
Energy 1.0
Finance 17.1
Health 6.9
Industrial Machinery & Equipment 8.8
Media & Leisure 6.6
Nondurables 3.7
Precious Metals 0.5
Retail & Wholesale 2.3
Services 3.6
Technology 19.8
Transportation 0.9
Utilities 2.7
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $242,411,596. Net unrealized depreciation
aggregated $2,570,715, of which $33,087,155 related to appreciated
investment securities and $35,657,870 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $62,709,000 of which $10,408,000, $17,259,000 and
$35,042,000 will expire on October 31, 2003, 2004 and 2005,
respectively.
PACIFIC BASIN
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
239,840,881
(COST $241,934,459) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD
3,998,745

RECEIVABLE FOR FUND SHARES SOLD
510,507

DIVIDENDS RECEIVABLE
568,964

INTEREST RECEIVABLE 69,219

RECEIVABLE FOR DAILY VARIATION ON FUTURES CONTRACTS 39,825

TOTAL ASSETS
245,028,141

LIABILITIES

PAYABLE TO CUSTODIAN BANK $ 1,079,999

PAYABLE FOR INVESTMENTS PURCHASED 3,059,408

PAYABLE FOR FUND SHARES REDEEMED 945,038

ACCRUED MANAGEMENT FEE 192,365

OTHER PAYABLES AND 233,905

ACCRUED EXPENSES

TOTAL LIABILITIES
5,510,715

NET ASSETS $
239,517,426

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
304,983,637

DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME
(335,592)

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(62,737,016)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(2,393,603)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 17,867,249 $
239,517,426
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($239,517,426 (DIVIDED BY) 17,867,249 SHARES) $13.41

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $13.41) $13.82

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 4,224,268
DIVIDENDS

INTEREST 566,154

4,790,422

LESS FOREIGN TAXES WITHHELD (371,478)

TOTAL INCOME 4,418,944

EXPENSES

MANAGEMENT FEE $ 2,620,497
BASIC FEE

PERFORMANCE ADJUSTMENT (195,610)

TRANSFER AGENT FEES 1,440,032

ACCOUNTING FEES AND EXPENSES 261,996

NON-INTERESTED TRUSTEES' COMPENSATION 2,164

CUSTODIAN FEES AND EXPENSES 231,035

REGISTRATION FEES 85,402

AUDIT 54,924

LEGAL 5,216

INTEREST 13,507

REPORTS TO SHAREHOLDERS 70,217

MISCELLANEOUS 13,724

TOTAL EXPENSES BEFORE REDUCTIONS 4,603,104

EXPENSE REDUCTIONS (60,412) 4,542,692

NET INVESTMENT INCOME (LOSS) (123,748)

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (32,033,379)

FOREIGN CURRENCY TRANSACTIONS (77,696)

FUTURES CONTRACTS (208,611) (32,319,686)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 9,813,613

ASSETS AND LIABILITIES IN 44,870
FOREIGN CURRENCIES

FUTURES CONTRACTS (296,343) 9,562,140

NET GAIN (LOSS) (22,757,546)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (22,881,294)

OTHER INFORMATION $ 218,156
SALES CHARGES PAID TO FDC

DEFERRED SALES CHARGES WITHHELD $ 15,796
BY FDC

EXPENSE REDUCTIONS $ 55,671
DIRECTED BROKERAGE ARRANGEMENTS

TRANSFER AGENT CREDITS 4,741

$ 60,412

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ (123,748) $ 1,804,391
NET INVESTMENT INCOME (LOSS)

NET REALIZED GAIN (LOSS) (32,319,686) (16,260,540)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 9,562,140 (1,144,219)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (22,881,294) (15,600,368)

DISTRIBUTIONS TO SHAREHOLDERS (363,575) -
FROM NET INVESTMENT INCOME

IN EXCESS OF NET INVESTMENT INCOME (2,160,117) -

TOTAL DISTRIBUTIONS (2,523,692) -

SHARE TRANSACTIONS 95,487,816 529,218,224
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 2,485,317 -

COST OF SHARES REDEEMED (405,452,612) (259,448,198)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (307,479,479) 269,770,026

REDEMPTION FEES 252,002 345,316

TOTAL INCREASE (DECREASE) IN NET ASSETS (332,632,463) 254,514,974

NET ASSETS

BEGINNING OF PERIOD 572,149,889 317,634,915

END OF PERIOD (INCLUDING UNDER (OVER) DISTRIBUTION OF NET INVESTMENT INCOME OF
$(335,592) AND $363,575, RESPECTIVELY) $ 239,517,426 $ 572,149,889

OTHER INFORMATION
SHARES

SOLD 6,377,029 34,672,919

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 168,725 -

REDEEMED (27,740,166) (16,960,967)

NET INCREASE (DECREASE) (21,194,412) 17,711,952

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEARS ENDED OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 D 1993

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.65 $ 14.88 $ 19.96 $ 17.48 $ 12.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME (LOSS) (.01) C .05 C .07 C .10 .20

NET REALIZED AND UNREALIZED GAIN (LOSS) (1.16) (.29) (3.12) 2.78 5.39

TOTAL FROM INVESTMENT OPERATIONS (1.17) (.24) (3.05) 2.88 5.59

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.01) - - (.01) (.11)

IN EXCESS OF NET INVESTMENT INCOME (.07) - (.02) (.11) -

FROM NET REALIZED GAIN - - (2.02) (.28) -

TOTAL DISTRIBUTIONS (.08) - (2.04) (.40) (.11)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .01 .01 .01 - -

NET ASSET VALUE, END OF PERIOD $ 13.41 $ 14.65 $ 14.88 $ 19.96 $ 17.48

TOTAL RETURN A, B (7.97)% (1.55)% (15.87)% 16.88% 47.06%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 239,517 $ 572,150 $ 317,635 $ 553,532 $ 493,533

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.32% 1.26% 1.32% 1.54% 1.59%
E

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.31% 1.24% 1.32% 1.54% 1.59%
F F

RATIO OF NET INVESTMENT INCOME (LOSS) TO AVERAGE NET ASSETS (.04)% .30% .44% .04% .15%

PORTFOLIO TURNOVER RATE 42% 85% 65% 88% 77%

AVERAGE COMMISSION RATE G $ .0204 $ .0151

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE ONE
TIME SALES CHARGE. C NET INVESTMENT INCOME (LOSS) PER
SHARE HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING
DURING THE PERIOD. D EFFECTIVE NOVEMBER 1, 1993, THE FUND ADOPTED
STATEMENT OF POSITION 93-2, "DETERMINATION, DISCLOSURE, AND
FINANCIAL STATEMENT PRESENTATION OF INCOME, CAPITAL GAIN,
AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INVESTMENT INCOME (LOSS) PER SHARE MAY REFLECT
CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES. E
FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER. F FMR OR THE FUND HAS ENTERED INTO VARYING
ARRANGEMENTS WITH THIRD PARTIES WHO EITHER PAID OR REDUCED A
PORTION OF THE FUND'S EXPENSES (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). G FOR FISCAL YEARS BEGINNING ON OR AFTER
SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE
COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH
COMMISSIONS ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD
AND FUND TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS
MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES
MAY DIFFER.

</TABLE>

SOUTHEAST ASIA
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

SOUTHEAST ASIA -32.48% 1.30%

SOUTHEAST ASIA -34.51% -1.74%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -34.59% 8.81%
INTERNATIONAL FAR EAST
EX-JAPAN FREE INDEX

PACIFIC EX-JAPAN FUNDS AVERAGE -25.68% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on April 19, 1993. For example, if you had invested $1,000 in
a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the Morgan Stanley Capital International Far East
ex-Japan Free Index - a market capitalization weighted index of over
450 stocks traded in eight Asian markets, excluding Japan. The index
is weighted by each country's market capitalization (or the total
value of its outstanding shares). To measure how the fund's
performance stacked up against its peers, you can compare it to the
Pacific ex-Japan funds average, which reflects the performance of
mutual funds with similar objectives tracked by Lipper Analytical
Services, Inc. The past one year average represents a peer group of 76
mutual funds. These benchmarks include reinvested dividends and
capital gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

SOUTHEAST ASIA -32.48% 0.29%

SOUTHEAST ASIA -34.51% -0.39%
(INCL. 3% SALES CHARGE)

MORGAN STANLEY CAPITAL -34.59% 1.88%
INTERNATIONAL FAR EAST
EX-JAPAN FREE INDEX

PACIFIC EX-JAPAN FUNDS AVERAGE -25.68% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
SOUTHEAST ASIA
FUND TALK: THE MANAGER'S OVERVIEW

An interview with Allan Liu, Portfolio Manager of Fidelity Southeast
Asia Fund
Q. HOW DID THE FUND PERFORM, ALLAN?
A. For the 12 months that ended October 31, 1997, the fund had a total
return of -32.48%. During the same period, the Pacific ex-Japan funds
average tracked by Lipper Analytical Services returned -25.68%, and
the Morgan Stanley Capital International Far East ex-Japan Free Index
returned -34.59%.
Q. WHAT CAUSED THE STEEP DROP IN THE SOUTHEAST ASIAN MARKETS DURING
THE PAST SIX MONTHS?
A. The problems in Thailand and the resulting devaluation of the Thai
baht alerted foreign investors to the structural problems in many
Southeast Asian countries. By structural problems, I mean
over-investments in real estate, bank-financed share purchasing and an
over-dependence on foreign capital. One of the biggest problems in
countries such as Thailand and Malaysia was over-investment in
properties. For instance, many office buildings were built recently,
but the demand has not been high enough to occupy the new space. I
think it may take the market a couple of years to digest this added
capacity, so I consider these to be unproductive investments in the
near term. Another problem that we saw in countries such as Thailand
and Malaysia was large share margin financing positions, meaning that
shares were pledged to financial institutions to secure loans for
individuals. This type of financing becomes quite precarious during a
market correction. Finally, many Southeast Asian countries became
overly dependent on foreign capital, making these economies more
vulnerable to downturns if foreign investors pulled out of the market.
Q. WHAT HAPPENED TO THE CURRENCIES?
A. In the past, most Asian currencies were closely linked with the
U.S. dollar. On July 2, 1997, Thailand's central bank decided to float
the baht - allowing it to fluctuate in a wider range - because the
country could no longer afford to maintain the link between the
currency and the U.S. dollar. As the baht moved lower, Thai companies
began facing currency-rate-related losses, given their large foreign
debt exposure. Several other Southeast Asian currencies were then
under attack and investors began to lose confidence in the region's
financial markets. Domestic interest rates were kept high in an
attempt to maintain the strength of the currencies. But higher
interest rates generally slow domestic economic growth as the cost of
borrowing increases. Many investors pulled their money out of
Southeast Asia during the period, dampening the performance of the
region's stock markets.
Q. WHY DID THE FUND'S PERFORMANCE LAG THAT OF THE LIPPER AVERAGE
DURING THE PERIOD?
A. The main problem the fund faced during the period was massive
redemptions. The fund's size dropped by close to 50% over the past six
months. Both redemptions and capital losses were responsible for the
sharp decline in the fund's assets. As a result of redemptions, I had
to sell stocks in falling markets.
Q. HOW DO YOU MANAGE THE FUND WHEN THERE HAVE BEEN SO MANY
REDEMPTIONS?
A. I pay more attention to the liquidity of the securities in the
portfolio. Hong Kong and Taiwan are still by far the most liquid in
the region. I also focused on companies with strong balance sheets and
proven management records.
Q. SO, TAIWAN AND HONG KONG WERE THE MOST ATTRACTIVE PLACES TO INVEST
DURING THE PERIOD?
A. At the end of April, about 6.9% of the fund was invested in Taiwan.
I boosted that allocation to about 11.9% by the end of October.
Specifically, I focused the fund's Taiwan investments on electronics
companies that mainly export their products to the U.S. or Europe. As
such, those companies should be less subject to the contagious effects
of currency devaluations and economic difficulties in Southeast Asia.
In fact, Taiwan was one of the better-performing countries in the
region during the period. As far as Hong Kong, the companies there
generally have very healthy balance sheets and the management quality
is among the best in Southeast Asia.
Q. WHAT OTHER FACTORS HURT THE FUND'S PERFORMANCE?
A. The fund's overweighted position in Thailand early in the period,
relative to the Morgan Stanley index, detracted from performance.
Originally, the problems in Thailand looked as though they were
cyclical in nature. Therefore, the fund maintained a relatively high
investment there, anticipating a quick recovery. However, when I
realized there were quite a few structural problems behind Thailand's
economic downturn, I reduced the fund's position in that country.
Also, by drawing an analogy between Thailand and its neighboring
countries, I decided to quickly reduce the fund's exposure to
Malaysia, the Philippines and Indonesia.
Q. DID THE FUND'S REDUCED EXPOSURE TO THESE MARKETS HELP PERFORMANCE?
A. Yes. The fund's aggressive stance of reducing exposure to most of
these countries since April - after the Malaysian Central Bank
announced a series of measures to tighten credit growth - helped
position the fund defensively. The Malaysian market subsequently
tumbled as investors sold off shares as problems similar to Thailand's
arose, such as the property lending and share financing issues I
discussed earlier. Then, after the free floatation of the Thai baht on
July 2, all Southeast Asian currencies were under severe attack. Only
the Singapore dollar was able to hold its own, while the Malaysian
ringgit, Indonesian rupiah, Philippine peso and Thai baht all reported
substantial losses versus the U.S. dollar. This situation led to
indiscriminate selling of shares as foreign investors desperately
began fleeing these markets. However, an early underweighted position
in these markets reduced damage to the fund.
Q. WHICH STOCKS PERFORMED RELATIVELY WELL FOR THE FUND?
A. A few Hong Kong companies outperformed the Hang Seng Index - Hong
Kong's local equity index - during the period. Hutchison Whampoa, a
conglomerate, returned 1.5% during the 12-month period, while the
index returned -12.4%. Even better, HSBC Holdings, an international
banking group, generated a fairly strong return of 14.2%. Helping the
fund more was the fact that the Hong Kong dollar maintained a very
stable relationship versus the U.S. dollar throughout the period.
Q. WHAT'S YOUR OUTLOOK?
A. I think volatility will continue in the Southeast Asian markets for
some time, as we haven't seen the end of the contagious effects on
currencies, interest rates and economic growth. The International
Monetary Fund has intervened in Thailand and Indonesia, proposing
structural changes that would facilitate the redevelopment of these
economies over the longer term. It will take some time for these
countries to sort out their structural problems once they are
identified. Overall, I plan on investing the fund's assets in
companies with very strong balance sheets that will be able to carry
them through the crisis. In the short term, their share prices may
remain weak, and they may become less profitable, but over the long
term these companies will be the winners. In addition, I plan to focus
on export-oriented companies and to reduce the fund's exposure to
interest-rate-sensitive stocks.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

ALLAN LIU ON INVESTING IN SOUTHEAST ASIA DURING THE
CRISIS:
"As more foreign investors pull their money out of Southeast
Asia to invest in other emerging markets that may offer better
growth prospects in the short term, valuations of some of the
region's companies are reaching historically attractive levels.
In fact, part of the reason that I plan to hold slightly more cash
in the near future is to capture a few of these opportunities as
they arise. However, Southeast Asian economies are in the
midst of structural changes and it takes time for the
adjustments to happen.
"Exchange rates and interest rates continue to be volatile
throughout the region. The structural problems need to be
addressed so that we can see a more stable economic
environment. We need to see a stable exchange rate, so that
interest rates can come off from their existing high levels.
Once that happens, the confidence of local and foreign
investors can be restored gradually.
"Remember, many of these Southeast Asian countries
experienced strong growth for about 10 years prior to this
period. However, much of the growth was financed by foreign
capital. The recent reversal of that trend severely damaged
many of the economies, especially in Malaysia, Thailand, the
Philippines, Indonesia and South Korea.
"As far as trends in Hong Kong, I think the economic reform
in China will help both the Hong Kong and Chinese stock
markets. This is the first time in years that the Chinese
government has shown a strong determination to improve
productivity in China. Since Hong Kong is now a part of
China, the success or failure of these activities definitely will
be felt in Hong Kong's economy. Despite facing difficulties in
the short term, I am optimistic about these reforms in the
long term.
"Compared with other Southeast Asian stock markets, I feel
that many Hong Kong companies have strong balance sheets
and proven management records. In addition, as investors
indiscriminately sell stocks during times of crisis, buying
opportunities will no doubt emerge in other Southeast
Asian countries."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of Southeast Asian
issuers; the fund does not anticipate investing
in Japan
FUND NUMBER: 351
TRADING SYMBOL: FSEAX
START DATE: April 19, 1993
SIZE: as of October 31, 1997, more than
$278 million
MANAGER: Allan Liu, since inception; manager,
various funds for non-U.S. investors; analyst,
Southeast Asian markets, 1987-1990; joined
Fidelity in 1987
(checkmark)
SOUTHEAST ASIA
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
UNITED KINGDOM 3.6%
ROW: 1, COL: 1, VALUE: 3.6
ROW: 1, COL: 2, VALUE: 9.199999999999999
ROW: 1, COL: 3, VALUE: 11.9
ROW: 1, COL: 4, VALUE: 13.8
ROW: 1, COL: 5, VALUE: 4.8
ROW: 1, COL: 6, VALUE: 6.0
ROW: 1, COL: 7, VALUE: 4.4
ROW: 1, COL: 8, VALUE: 39.3
ROW: 1, COL: 9, VALUE: 7.0
CHINA 7.0%
UNITED STATES 9.2%
TAIWAN 11.9%
HONG KONG 39.3%
SINGAPORE 13.8%
OTHER 4.8%
MALAYSIA 6.0%
INDONESIA 4.4%
AS OF APRIL 30, 1997
UNITED STATES 3.5%
TAIWAN 6.9%
ROW: 1, COL: 1, VALUE: 3.5
ROW: 1, COL: 2, VALUE: 6.9
ROW: 1, COL: 3, VALUE: 14.8
ROW: 1, COL: 4, VALUE: 3.3
ROW: 1, COL: 5, VALUE: 5.2
ROW: 1, COL: 6, VALUE: 20.4
ROW: 1, COL: 7, VALUE: 3.6
ROW: 1, COL: 8, VALUE: 8.4
ROW: 1, COL: 9, VALUE: 33.9
SINGAPORE 14.8%
HONG KONG 33.9%
PHILIPPINES 3.3%
OTHER 5.2%
INDONESIA 8.4%
MALAYSIA 20.4%
KOREA (SOUTH) 3.6%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 90.7 96.5

BONDS 0.1 0.0

SHORT-TERM INVESTMENTS 9.2 3.5

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

HUTCHISON WHAMPOA LTD. ORD. 7.9 4.7
(HONG KONG, ELECTRICAL EQUIPMENT)

HONG KONG TELECOMMUNICATIONS LTD. 6.2 0.3
(HONG KONG, TELEPHONE SERVICES)

SUN HUNG KAI PROPERTIES LTD. 5.0 3.9
(HONG KONG, REAL ESTATE)

CHEUNG KONG HOLDINGS LTD. 4.2 3.0
(HONG KONG, REAL ESTATE)

HSBC HOLDING PLC 3.6 2.2
(UNITED KINDOM, BANKS)

HANG SENG BANK LTD. 3.4 3.8
(HONG KONG, BANKS)

NEW WORLD DEVELOPMENT CO. LTD. 2.3 1.2
(HONG KONG, REAL ESTATE)

HONG KONG & CHINA GAS CO. LTD. 2.0 0.4
(HONG KONG, GAS)

GULF INDONESIA RESOURCES LTD. 2.0 0.0
(NEW YORK)
(INDONESIA, OIL & GAS)

HONG KONG ELECTRIC HOLDINGS ORD. 1.8 0.0
(HONG KONG, ELECTRIC UTILITY)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

TECHNOLOGY 15.0 5.4

UTILITIES 14.8 6.4

CONSTRUCTION & REAL ESTATE 12.6 18.2

FINANCE 10.9 22.2

INDUSTRIAL MACHINERY & EQUIPMENT 10.9 5.7

ENERGY 4.9 1.2

MEDIA & LEISURE 4.4 9.8

TRANSPORTATION 4.0 3.0

NONDURABLES 3.4 4.5

BASIC INDUSRIES 3.4 5.9

SOUTHEAST ASIA
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 90.7%
SHARES VALUE (NOTE 1)
CHINA (PEOPLES REPUBLIC) - 7.0%
Angang New Steel Co. Ltd. Class H 2,424,000 $ 536,228
Beijing Datang Power Generation Co.
Ltd. Class H 1,422,000 717,439
Chengdu Telecom Cable Co. Class H 2,586,000 786,171
China Eastern Airlines Corp. Ltd.
Class H 1,642,000 371,734
Dongfang Electrical Machinery Co. Ltd.
Class H 1,956,000 442,820
First Tractor Co. Ltd. Class H (a) 3,484,000 2,704,269
Guangdong Kelon Electric Holding
Class H 272,000 344,838
Harbin Power Equipment Co. Ltd.
Class H 6,970,000 1,334,489
Jiangsu Wuling Diesel Engine Co. Ltd.
Class B 617,700 269,317
Jingwei Textile Machinery Co. Ltd.
Class H 2,580,000 383,829
Kunming Machine Tool Co. Class H (a) 1,570,000 203,105
Maanshan Iron & Steel Co. Ltd.
Class H 12,800,000 2,036,740
Nanjing Panda Electronics Co.
Class H 2,282,000 442,820
Northeast Electrical Transmission &
Transformation Machinery Mfg.
Co. Ltd. Class H 4,394,000 778,756
Shanghai Petrochemical Class H 3,104,000 833,221
Sichuan Expressway Co. Ltd. Class H 4,280,000 570,298
Zhejiang Southeast Electric Power Co.
Ltd. Class B (a) 2,304,600 742,081
Zhenhai Refining & Chemical Co.
Class H 7,372,000 3,433,273
Zhejiang Expressway Co. Class H (a) 6,806,000 1,320,699
18,252,127
HONG KONG - 39.3%
Cheung Kong Holdings Ltd. 1,577,000 10,965,556
China Aerospace International
Holdings Ltd. 960,600 375,914
China Light & Power Co. Ltd. 240,000 1,263,648
China Resources Enterprise Ltd. 880,000 2,413,454
China Foods Holdings Ltd. 2,738,000 1,204,295
Dao Heng Bank Group Ltd. 84,000 193,428
Founder Hong Kong Ltd. 244,000 192,549
Guangdong Investments Co. Ltd. Ord. 792,000 504,605
Guangnan Holdings 704,000 646,624
Guangdong Brewery Holdings Ltd. 1,720,000 315,964
Hang Seng Bank Ltd. 1,014,000 8,821,669
HKCB Bank Holding Co. Ltd. 1,102,000 841,113
Hong Kong & China Gas Co. Ltd. 2,725,600 5,147,964
Hong Kong Telecommunications Ltd. 8,392,000 16,102,153
Hong Kong Electric Holdings Ord. 1,380,000 4,677,361
Hutchison Whampoa Ltd. Ord. 3,002,000 20,777,102
Kumagai Gumi 442,000 405,977
Ng Fung Hong Ltd. 1,594,000 1,495,019
New World Development Co. Ltd. 1,677,100 5,901,309
New World Infrastructure Ltd. (a) 612,000 1,211,332
South China Morning Post Holdings 1,946,000 1,686,701
Shanghai Industrial Holdings Ltd.
Class H 393,000 1,748,926
Sun Hung Kai Properties Ltd. 1,762,000 12,992,755

SHARES VALUE (NOTE 1)
Swire Pacific Ltd. Class A 130,000 $ 694,567
Television Broadcast Ltd. Ord. 696,000 1,935,834
Yugang International Ltd. 5,176,000 415,151
102,930,970
INDONESIA - 4.4%
PT Gudang Garam 688,500 1,950,752
Gulf Indonesia Resources Ltd.
(New York) 243,100 5,105,100
PT Lippo Securities 1,250,700 130,281
PT Telkom, Series B 2,372,000 2,207,280
PT Telekomunikasi Indonesia Persero,
Series B sponsored ADR 107,300 2,085,644
11,479,057
KOREA (SOUTH) - 2.2%
Dae Duck Electronics Co. Ltd. 42,000 1,653,885
Hyundai Engineering & Construction
Co. Ltd. (a) 8 119
Hyundai Motor Co. Ltd. sponsored
GDR (c) 34,000 119,000
Korea Electric Power Corp. 10,000 141,969
Lotte Confectionary Co. 7,210 821,865
Samsung Co. Ltd. sponsored GDR (a) 21 26
S1 Corp. 15,401 1,835,352
Sewoo Polymer Co. Ltd. 36,570 1,208,894
5,781,110
MALAYSIA - 6.0%
Berjaya Group BHD 1,150,000 497,761
Berjaya Sports Toto BHD 1,687,833 4,584,860
Malaysia International Shipping BHD
(For. Reg.) (a) 444,000 742,209
PWE Industries BHD 602,400 2,589,421
Puncak Niaga Holdings BHD 142,000 167,009
Petronas Gas BHD 627,000 1,684,478
Rothmans of Pall Mall Malaysia BHD 323,000 2,579,179
Tenega Nasional BHD 1,055,000 2,267,463
United Engineers BHD 109,000 257,045
YTL Power International BHD (a) 583,000 464,660
15,834,085
PHILIPPINES - 1.8%
Ionics Circuits, Inc. 561,000 329,766
Manila Electric Co. Class B 189,851 580,847
Music Corp. (a) 4,547,400 1,771,296
Philippine Long Distance Telephone 85,000 2,106,941
4,788,850
SINGAPORE - 13.7%
City Developments Ltd. 335,000 1,405,594
Creative Technology Ltd. (a) 10,900 277,269
Creative Technology Ltd. (SGD) (a) 115,000 2,924,348
Datacraft Asia Ltd. 1,069,000 2,437,320
Development Bank of Singapore Ltd.
(For. Reg.) 355,000 3,317,546
Elec & Eltek International Co. Ltd. 234,000 1,684,800
Flextech Holdings Ltd. 947,000 999,379
Flextech Holdings Ltd.
warrants 10/22/02 (a) 284,100 -
FHTK Holdings Ltd. 6,324,000 2,110,681
Lindeteves-Jacoberg Ltd. 54,000 58,360
Natsteel Ltd. 1,625,000 2,634,298
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
SINGAPORE - CONTINUED
Natsteel Electronics Ltd. (a) 38,000 $ 55,804
Parkway Holdings Ltd. 311,000 786,891
Rothmans Industries Ltd. 256,000 1,025,302
Singapore International Airlines Ltd. 614,000 4,605,976
Singapore Press Holdings Ltd. (For. Reg.) 232,800 3,211,545
Singapore Technologies Aerospace Ltd. 369,000 971,176
Singapore Technologies Automotive Ltd. 179,000 525,734
Singapore Telecommunications Ltd. 695,000 1,104,577
United Overseas Bank Ltd. (For. Reg.) 600,500 3,321,265
Venture Manufacturing Singapore Ltd. 684,000 2,348,125
35,805,990
TAIWAN - 11.9%
Acer, Inc. GDR (a)(c) 199,500 1,246,870
Acer, Inc. (a) 2,715,000 3,731,475
Acer Peripherals, Inc. 383,000 651,783
Asustek Computer, Inc. (a) 209,000 2,628,590
Compal Electronics, Inc. (a) 790,600 1,806,720
Compal Electronics, Inc.
rights 11/11/97 (a) 68,260 -
China Motor Co. Ltd. 522,950 1,161,169
China Development Corp. (a) 804,500 2,281,807
China Trust Co. Ltd. (a) 192,750 266,164
Delta Electronics Ind. Co. Ltd. 117,000 373,566
Everest Textile Co. Ltd. (a) 1,910,000 1,547,812
Formosa Plastic 92,430 147,409
Fu Sheng Industry Co. Ltd. (a) 289,000 964,895
Hon Hai Precision Ind. Co. (a) 90,000 382,172
Hotung Investment Holdings Ltd. (a) 8,522,000 2,045,280
Inventec Co. Ltd. (a) 241,000 956,969
Liton Electronics 168,000 424,765
President Enterprises Corp. (a) 747,600 860,285
Taiwan Mask Corp. (a) 1,103,000 3,861,394
Taiwan Secom Co. (a) 578,800 1,894,937
Taiwan Semiconductor Manufacturing
Co. Ltd. (a) 782,500 2,473,055
UMAX Data Systems, Inc. (a) 414,000 966,224
UMAX Data Systems, Inc.
rights 1/31/98 (a) 37,653 -
Yageo Corp. (a) 166,800 351,442
Yieh Phui Enterprise Co. 22,000 12,337
31,037,120
THAILAND - 0.8%
PTT Exploration & Production (For. Reg.) 180,500 1,803,900
Siam Cement PCL (For. Reg.) 47,400 395,144
2,199,044
UNITED KINGDOM - 3.6%
HSBC Holdings PLC 401,847 9,414,873
TOTAL COMMON STOCKS
(Cost $311,583,247) 237,523,226
NONCONVERTIBLE BONDS - 0.1%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) AMOUNT (D) (NOTE 1)
SINGAPORE - 0.1%
Flextech Holdings Ltd.
2 1/4%, 1/1/02
(Cost $151,850) - SGD 236,750 $ 150,509
CASH EQUIVALENTS - 9.2%
SHARES
Taxable Central Cash Fund (b)
(Cost $24,065,141) 24,065,141 24,065,141
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $335,800,238) $ 261,738,876
CURRENCY ABBREVIATIONS
SGD - Singapore dollar
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
(c) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.
At the period end, the value of these securities amounted to
$1,365,870 or 0.5% of net assets.
(d) Principal amount stated in United States dollars unless otherwise
noted.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $774,445,575 and $1,127,866,165, respectively.
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Value of Investment in Securities
Basic Industries 3.4%
Cash Equivalents 9.2
Construction & Real Estate 12.6
Durables 0.8
Energy 4.9
Finance 10.9
Holding Companies 2.3
Industrial Machinery & Equipment 10.9
Media & Leisure 4.4
Nondurables 3.4
Retail & Wholesale 1.3
Services 2.1
Technology 15.0
Transportation 4.0
Utilities 14.8
100.0%
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $337,840,323. Net unrealized depreciation
aggregated $76,101,447, of which $5,732,646 related to appreciated
investment securities and $81,834,093 related to depreciated
investment securities.
At October 31, 1997, the fund had a capital loss carryforward of
approximately $32,652,000 all of which will expire on October 31,
2005.
SOUTHEAST ASIA
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
261,738,876
(COST $335,800,238) - SEE ACCOMPANYING SCHEDULE

FOREIGN CURRENCY HELD AT VALUE
7,797,787
NEW TAIWAN DOLLARS

(COST $8,404,768)

RECEIVABLE FOR INVESTMENTS SOLD
14,826,001

RECEIVABLE FOR FUND SHARES SOLD
2,893,055

DIVIDENDS RECEIVABLE
209,348

INTEREST RECEIVABLE
149,159

REDEMPTION FEES RECEIVABLE 225

TOTAL ASSETS
287,614,451

LIABILITIES

PAYABLE FOR INVESTMENTS PURCHASED $ 5,096,234

PAYABLE FOR FUND SHARES REDEEMED 3,106,487

ACCRUED MANAGEMENT FEE 232,493

OTHER PAYABLES AND 332,272

ACCRUED EXPENSES

TOTAL LIABILITIES
8,767,486

NET ASSETS $
278,846,965

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
386,752,002

UNDISTRIBUTED NET INVESTMENT INCOME
752,671

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
(33,989,123)

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS
(74,668,585)
AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 29,198,708 $
278,846,965
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($278,846,965 (DIVIDED BY) 29,198,708 SHARES) $9.55

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $9.55) $9.85

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 7,510,001
DIVIDENDS

SPECIAL DIVIDEND FROM SUN HUNG KAI PROPERTIES LTD. 844,074

INTEREST 1,522,190

9,876,265

LESS FOREIGN TAXES WITHHELD (845,318)

TOTAL INCOME 9,030,947

EXPENSES

MANAGEMENT FEE $ 4,411,802
BASIC FEE

PERFORMANCE ADJUSTMENT 52,908

TRANSFER AGENT FEES 1,831,757

ACCOUNTING FEES AND EXPENSES 401,403

NON-INTERESTED TRUSTEES' COMPENSATION 4,054

CUSTODIAN FEES AND EXPENSES 826,131

REGISTRATION FEES 44,830

AUDIT 68,476

LEGAL 6,952

REPORTS TO SHAREHOLDERS 87,920

MISCELLANEOUS 4,791

TOTAL EXPENSES BEFORE REDUCTIONS 7,741,024

EXPENSE REDUCTIONS (16,003) 7,725,021

NET INVESTMENT INCOME 1,305,926

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES (27,660,669)

FOREIGN CURRENCY TRANSACTIONS (956,631) (28,617,300)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES (91,784,306)

ASSETS AND LIABILITIES IN (599,494) (92,383,800)
FOREIGN CURRENCIES

NET GAIN (LOSS) (121,001,100)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ (119,695,174)

OTHER INFORMATION $ 381,009
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 11,123
DIRECTED BROKERAGE ARRANGEMENTS

CUSTODIAN CREDITS 3,785

TRANSFER AGENT CREDITS 1,095

$ 16,003

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
OPERATIONS $ 1,305,926 $ 8,026,537
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) (28,617,300) 55,694,252

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) (92,383,800) (24,937,563)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (119,695,174) 38,783,226

DISTRIBUTIONS TO SHAREHOLDERS (4,930,534) (10,551,466)
FROM NET INVESTMENT INCOME

IN EXCESS OF NET INVESTMENT INCOME (3,526,327) -

FROM NET REALIZED GAIN (19,898,492) -

TOTAL DISTRIBUTIONS (28,355,353) (10,551,466)

SHARE TRANSACTIONS 157,877,019 546,524,731
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 27,853,163 10,313,913

COST OF SHARES REDEEMED (514,623,033) (481,254,069)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS (328,892,851) 75,584,575

REDEMPTION FEES 444,381 1,661,583

TOTAL INCREASE (DECREASE) IN NET ASSETS (476,498,997) 105,477,918

NET ASSETS

BEGINNING OF PERIOD 755,345,962 649,868,044

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $752,671 AND
$4,729,540, RESPECTIVELY) $ 278,846,965 $ 755,345,962

OTHER INFORMATION
SHARES

SOLD 11,474,774 35,716,913

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 1,884,517 741,474

REDEEMED (35,591,294) (31,850,201)

NET INCREASE (DECREASE) (22,232,003) 4,608,186

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED OCTOBER 31, APRIL 19, 1993
(COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996 1995 1994 E 1993

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 14.69 $ 13.88 $ 14.61 $ 13.24 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .04 D, I .14 D .15 .04 .01

NET REALIZED AND UNREALIZED GAIN (LOSS) (4.62) .87 (.91) 1.23 3.22

TOTAL FROM INVESTMENT OPERATIONS (4.58) 1.01 (.76) 1.27 3.23

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.10) (.23) - (.04) -

IN EXCESS OF NET INVESTMENT INCOME (.07) - - (.03) -

FROM NET REALIZED GAIN (.40) - - - -

TOTAL DISTRIBUTIONS (.57) (.23) - (.07) -

REDEMPTION FEES ADDED TO PAID IN CAPITAL .01 .03 .03 .17 .01

NET ASSET VALUE, END OF PERIOD $ 9.55 $ 14.69 $ 13.88 $ 14.61 $ 13.24

TOTAL RETURN B, C (32.48)% 7.59% (5.00)% 10.87% 32.40%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 278,847 $ 755,346 $ 649,868 $ 825,734 $ 499,669

RATIO OF EXPENSES TO AVERAGE NET ASSETS 1.32% 1.13% 1.10% 1.47% 2.00% A,
F

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE
REDUCTIONS 1.32% 1.12% G 1.10% 1.47% 2.00% A

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS .22% .95% .90% .22% .45% A

PORTFOLIO TURNOVER RATE 141% 102% 94% 157% 14% A

AVERAGE COMMISSION RATE H $ .0063 $ .0129

A ANNUALIZED B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN. C TOTAL RETURNS
DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF LESS
THAN ONE YEAR ARE NOT ANNUALIZED. D NET
INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON AVERAGE
SHARES OUTSTANDING DURING THE PERIOD. E EFFECTIVE NOVEMBER 1,
1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2, "DETERMINATION,
DISCLOSURE, AND FINANCIAL STATEMENT
PRESENTATION OF INCOME, CAPITAL GAIN, AND RETURN OF CAPITAL
DISTRIBUTIONS BY INVESTMENT COMPANIES." AS A RESULT, NET INVESTMENT
INCOME PER SHARE MAY REFLECT CERTAIN RECLASSIFICATIONS RELATED TO
BOOK TO TAX DIFFERENCES. F FMR AGREED TO REIMBURSE A
PORTION OF THE FUND'S EXPENSES DURING THE PERIOD. WITHOUT THIS
REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE BEEN HIGHER
G FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH
THIRD PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE
FUND'S EXPENSES (SEE NOTE 7 OF NOTES TO FINANCIAL STATEMENTS).
H FOR FISCAL YEARS BEGINNING ON OR AFTER SEPTEMBER 1, 1995,
A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE COMMISSION RATE PER
SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS ARE CHARGED.
THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND TO FUND
DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS MARKETS
WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES MAY
DIFFER. I INVESTMENT INCOME PER SHARE REFLECTS A SPECIAL DIVIDEND
FROM SUN HUNG KAI PROPERTIES LTD. WHICH AMOUNTED TO $.02 PER SHARE.

</TABLE>

UNITED KINGDOM
PERFORMANCE: THE BOTTOM LINE

There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). The fund has a 3% sales charge. If Fidelity had
not reimbursed certain fund expenses, the total returns would have
been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

UNITED KINGDOM 22.87% 46.68%

UNITED KINGDOM 19.18% 42.28%
(INCL. 3% SALES CHARGE)

FT-ALL-SHARES INDEX 24.78% 52.51%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year or since the fund
started on November 1, 1995. For example, if you had invested $1,000
in a fund that had a 5% return over the past year, the value of your
investment would be $1,050. You can compare the fund's returns to the
performance of the FT-All-Shares Index - a market capitalization
weighted index of over 750 stocks traded in the U.K. market. The index
covers more than 90% of the total capitalization of the U.K. market.
To measure how the fund's performance stacked up against its peers,
you can compare the fund's performance to the European region funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Analytical Services, Inc. The past one
year average represents a peer group of 68 mutual funds. These
benchmarks include reinvested dividends and capital gains, if any, and
exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED PAST 1 LIFE OF
OCTOBER 31, 1997 YEAR FUND

UNITED KINGDOM 22.87% 21.11%

UNITED KINGDOM 19.18% 19.28%
(INCL. 3% SALES CHARGE)

FT-ALL-SHARES INDEX 24.78% 23.49%

EUROPEAN REGION FUNDS AVERAGE 20.38% N/A

UNDERSTANDING PERFORMANCE
Many markets around the globe offer the potential
for significant growth over time; however, investing
in foreign markets means assuming greater risks than
investing in the United States. Factors like changes in
a country's financial markets, its local political and
economic climate, and the fluctuating value of its
currency create these risks. For these reasons an
international fund's performance may be more
volatile than a fund that invests exclusively in the
United States. Past performance is no guarantee
of future results and you may have a gain or loss
when you sell your shares.
(checkmark)
UNITED KINGDOM
FUND TALK: THE MANAGER'S OVERVIEW

NOTE TO SHAREHOLDERS: Simon Roberts became Portfolio Manager of
Fidelity United Kingdom Fund on July 28, 1997.
Q. HOW DID THE FUND PERFORM, SIMON?
A. For the 12 months that ended on October 31, 1997, the fund returned
22.87%. The FT-All-Shares Index returned 24.78% during the same
period, while the European region funds average, as tracked by Lipper
Analytical Services, returned 20.38%.
Q. WHAT FACTORS AFFECTED THE FUND'S PERFORMANCE?
A. The year was a period of extreme outperformance by
large-capitalization stocks over small- and mid-sized company stocks.
This fund is usually underweighted in large-capitalization stocks as I
seek opportunities where Fidelity's research can add the most value.
Because of its holdings in small- and mid-cap stocks, the fund trailed
the market index, which is dominated by large-capitalization stocks.
The fund was able to come close to the index's performance, however,
because it did have major positions in some large-cap stocks that did
extremely well in the energy, banking and pharmaceutical industries.
Q. HOW WOULD YOU DESCRIBE THE INVESTMENT ENVIRONMENT?
A. It was a very positive, stable environment that contributed to a
good performance by the stock market in the U.K. The nation did have a
change in government in May as the Labor Party took over, but it has
proven to be much more benign than people had feared. In fact, the
policies the government has been following thus far are very similar
to those of the previous Conservative government, with no radical
proposals in areas such as personal taxes. The U.K. has experienced
very little wage inflation, although there was some asset-price
inflation recently, particularly in real estate in some geographical
areas, such as southern England and London itself. We are just
starting to see overall inflation rising above government targets. A
major change by the new government was to give the Bank of England a
degree of independence, with authority to change interest rates. With
this authority and in response to early signs of inflation, the bank
has raised rates five times since the election. I think this is
extremely positive because the bank was able to pre-emptively strike
against inflation. At the same time, the financial markets have
received assurances that decisions regarding interest rates are now
largely removed from political considerations. I expect that interest
rates may rise a bit more, but then be stable, and that inflation and
interest rates may begin falling again in 1998. The supply-demand
relationships also are favorable. There are no plans for further large
privatizations of government-owned companies, so the supply of new
equities in the market will be reduced. On the demand side, we are
seeing a trend for companies to buy back their shares with excess
capital. This is very good for share values. In addition, the pound
Sterling has been strong against other European currencies, and
modestly strong against the dollar. The strength of the pound
Sterling, combined with modestly rising interest rates, has made this
a positive environment for dollar-based investors.
Q. WHAT COMPANIES HAVE BEEN MAJOR CONTRIBUTORS TO THE FUND'S
PERFORMANCE?
A. The fund's two largest holdings at the end of the period were both
energy companies - British Petroleum (BP) and Shell Transport &
Trading. Both have been exceptionally strong performers for the fund.
The key investment factor in both companies was their cost-cutting and
restructuring programs. These are corporations that decided to help
themselves by establishing very aggressive cost-cutting programs, both
of which were moving ahead of expectations. BP expects to save $2
billion in costs by the year 2000, and I believe Shell's program has
the potential to double earnings by the year 2001. On top of that,
both these stocks still were trading at discounts to the values of
comparable U.S. oil companies at the end of the fiscal year.
Q. FINANCE WAS THE FUND'S LARGEST INDUSTRY WEIGHTING, AT MORE THAN 13%
OF THE FUND'S INVESTMENTS. WHAT WAS YOUR STRATEGY HERE?
A. The fund's main exposure to finance was in three large banks,
Lloyd's, Barclays and Bank of Scotland. Similar to our energy
holdings, these banks have embarked on aggressive cost-cutting and
restructuring programs. In addition, there is some corporate
consolidation going on in the banking industry, allowing further
opportunities for cost-cutting. Lloyd's took over TSB in 1995,
providing a number of opportunities for efficiencies. Barclays has
focused on its return on capital, cutting out businesses that were not
achieving the required returns. In addition, it has been using excess
capital to buy back its own stock. The management of British banks
today is dramatically different from 10 years ago, when the clearing
banks, or money center banks as they are known in the U.S., were
aggressive in using excess capital for activities such as acquiring
investment banks. Now management is much more focused on shareholder
value, and is using excess capital for shareholder-friendly moves such
as share buyback programs.
Q. YOU EARLIER MENTIONED THE PHARMACEUTICAL INDUSTRY AS ONE THAT HAS
HELPED PERFORMANCE. WHAT STOCKS HELPED HERE?
A. SmithKline Beecham was an excellent performer. Its new products are
delivering revenue growth exceeding expectations, and earnings
forecasts were raised considerably. The sales of its new drugs have
been way ahead of schedule.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. The fund's performance was hurt by turmoil in Southeast Asia at the
end of its fiscal year. Some of the portfolio holdings have quite a
bit of exposure to that region. Among these holdings were Inchcape, a
trading and distribution company; HSBC, a banking company, half of
whose earnings come from Hong Kong; and Cable & Wireless, which has a
major investment in Hong Kong Telecom. In addition, the small- and
medium-sized companies have lagged. While I believe I have found value
among small- and mid-cap companies, their share prices have failed to
follow suit. I am still waiting, and I am still confident in them.
Q. WHAT IS YOUR OUTLOOK?
A. I believe the U.K. can continue to provide reasonably good
performance. The United Kingdom has moderate growth, and our
expectation is that British companies could increase their earnings by
more than 10% in 1998. Meanwhile, I expect both inflation and interest
rates to start falling again in 1998, both positive developments for
equity investing. I expect to see reasonable performance in the U.K.
market, which continues to be attractively valued in relation to other
markets.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.

SIMON ROBERTS ON HIS INVESTMENT STYLE:
"I buy stocks where I believe the financial potential of a
company is greater than is implied by the share price. I am
not focused on a particular type of company. I'm not just
looking for growth companies or cheap valuations. My
search for investment value can lead me to a number of
different types of company stocks. I will look for stocks
where earnings growth exceeds expectations. I will look for
stocks where earnings recovery is faster than people expect
and I will look for stocks that are incorrectly valued -
where the values are wrong in relation to comparable
investments in other markets.
"I always am looking at what is implied by the share price,
and I am looking for changes. I spend a great deal of time
with Fidelity's analysts, going over earnings projections and
seeing where our projections may be different from the
consensus estimates of the market. I am looking for the
places where differences occur."

FUND FACTS
GOAL: long-term growth of capital by investing
mainly in equity securities of British issuers
FUND NUMBER: 344
TRADING SYMBOL: FUTYF
START DATE: November 1, 1995
SIZE: as of October 31, 1997, more than
$5 million
MANAGER: Simon Roberts, since July,1997;
manager, Fidelity Germany Fund, 1995-1996;
Director of United Kingdom and European
Research, Fidelity International, Limited, since
1994; joined Fidelity in 1992.
(checkmark)
UNITED KINGDOM
INVESTMENT CHANGES

GEOGRAPHIC DIVERSIFICATION (% OF FUND'S INVESTMENTS)
AS OF OCTOBER 31, 1997
OTHER 0.3%
UNITED STATES 4.1%
ROW: 1, COL: 1, VALUE: 4.1
ROW: 1, COL: 2, VALUE: 95.3
ROW: 1, COL: 3, VALUE: 1.0
UNITED KINGDOM 95.6%
AS OF APRIL 30, 1997
UNITED STATES 5.2%
OTHER 2.3%
ROW: 1, COL: 1, VALUE: 5.2
ROW: 1, COL: 2, VALUE: 92.5
ROW: 1, COL: 3, VALUE: 2.3
UNITED KINGDOM 92.5%
ASSET ALLOCATION
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO

STOCKS 95.9 94.8

SHORT-TERM INVESTMENTS 4.1 5.2

TOP TEN STOCKS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO

SHELL TRANSPORT & TRADING CO. PLC (REG.) 5.0 4.6
(OIL & GAS)

BRITISH PETROLEUM PLC ORD. 4.5 4.7
(OIL & GAS)

HSBC HOLDINGS PLC (REG.) 4.0 0.0
(BANKS)

LLOYDS TSB GROUP PLC 3.7 4.3
(BANKS)

GLAXO WELLCOME PLC 3.7 0.0
(DRUGS & PHARMACEUTICALS)

BRITISH TELECOMMUNICATIONS PLC ORD. 3.1 4.7
(TELEPHONE SERVICES)

SMITHKLINE BEECHAM PLC ORD. 1.9 3.3
(DRUGS & PHARMACEUTICALS)

BAT INDUSTRIES PLC ORD. 1.8 2.4
(TOBACCO)

PENINSULAR & ORIENTAL STEAM 1.7 0.0
NAVIGATION CO.
(SHIPPING)

ZENECA GROUP PLC ORD. 1.7 0.0
(DRUGS & PHARMACEUTICALS)

TOP TEN MARKET SECTORS
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE
MARKET SECTORS
6 MONTHS AGO

FINANCE 13.4 20.2

NONDURABLES 12.1 15.0

ENERGY 10.8 9.3

RETAIL & WHOLESALE 9.1 7.6

UTILITIES 9.1 11.9

HEALTH 8.6 4.1

MEDIA & LEISURE 6.7 4.6

CONSTRUCTION & REAL ESTATE 5.3 6.1

SERVICES 5.3 6.9

BASIC INDUSTRIES 4.8 1.5

UNITED KINGDOM
INVESTMENTS OCTOBER 31, 1997

SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES

COMMON STOCKS - 95.9%
SHARES VALUE (NOTE 1)
BASIC INDUSTRIES - 4.8%
CHEMICALS & PLASTICS - 3.3%
Albright & Wilson PLC 11,000 $ 29,914
BTP PLC 5,500 30,926
British Polythene Industries PLC 3,900 30,023
British Vita Ord. 9,000 36,449
Courtaulds PLC Ord. 2,800 13,027
McKechnie PLC 5,100 42,930
183,269
METALS & MINING - 0.8%
English China Clay PLC 10,900 47,427
PAPER & FOREST PRODUCTS - 0.7%
Rexam PLC 1,500 7,832
Smith Holdings PLC 8,600 32,814
40,646
TOTAL BASIC INDUSTRIES 271,342
CONSTRUCTION & REAL ESTATE - 5.3%
BUILDING MATERIALS - 2.0%
Aggregate Industries PLC 20,000 17,906
Hanson Trust PLC Ord. 7,000 35,729
Norcros PLC Class L (a) 20,000 25,772
Polypipe PLC 9,000 32,834
112,241
CONSTRUCTION - 1.2%
Amec PLC Ord. 100 236
Beazer Homes Group PLC 10,000 30,694
Persimmon PLC Ord. 10,900 39,036
69,966
ENGINEERING - 1.2%
EIS Group PLC Ord. 4,700 25,956
Meggitt Holdings PLC 14,400 35,184
Weir Group PLC (The) 1,100 5,108
66,248
REAL ESTATE - 0.9%
Land Securities 2,900 48,531
TOTAL CONSTRUCTION & REAL ESTATE 296,986
DURABLES - 3.5%
AUTOS, TIRES, & ACCESSORIES - 1.6%
BSG, Inc. 12,900 27,633
Dennis Group PLC 6,600 34,958
Laird Group 4,000 28,617
91,208
TEXTILES & APPAREL - 1.9%
Berisford (S.W.) PLC 10,000 28,449
Black (Peter) Holdings 3,900 23,692
Courtaulds Textiles PLC 5,000 28,617
House of Fraser PLC Class L 7,500 26,985
107,743
TOTAL DURABLES 198,951
ENERGY - 10.8%
OIL & GAS - 10.8%
British Petroleum PLC Ord. 17,475 256,181
Britton Group PLC 22,500 39,913
Monument Oil and Gas PLC Class L (a) 20,000 29,454
Shell Transport & Trading Co. PLC (Reg.) 40,000 282,989
608,537

SHARES VALUE (NOTE 1)
FINANCE - 13.4%
BANKS - 10.3%
Bank of Scotland 10,100 $ 83,160
Barclays PLC Ord. 2,562 64,012
HSBC Holdings PLC (Reg.) 9,699 227,238
Lloyds TSB Group PLC 16,611 207,099
581,509
CREDIT & OTHER FINANCE - 1.0%
Cattles Holdings 8,967 56,274
INSURANCE - 2.1%
Liberty International Holdings PLC 2,743 22,172
London Insurance Market Investment
Trust PLC 13,700 31,410
Royal & Sun Alliance Insurance
Group PLC 6,651 63,611
117,193
TOTAL FINANCE 754,976
HEALTH - 8.6%
DRUGS & PHARMACEUTICALS - 7.8%
AEA Technology PLC 4,200 33,035
Glaxo Wellcome PLC 9,622 205,789
SmithKline Beecham PLC Ord. 11,088 104,840
Zeneca Group PLC Ord. 3,000 94,436
438,100
MEDICAL EQUIPMENT & SUPPLIES - 0.8%
Oxford Instruments PLC 2,500 16,609
Seton Healthcare Group PLC 1,700 13,514
Unichem PLC 3,200 14,727
44,850
TOTAL HEALTH 482,950
HOLDING COMPANIES - 1.4%
Cookson Group PLC 10,806 43,220
Hunting Group PLC 9,800 37,229
80,449
INDUSTRIAL MACHINERY & EQUIPMENT - 3.3%
ELECTRICAL EQUIPMENT - 2.3%
Choride Group PLC 45,000 30,500
General Electric PLC Class L 12,000 76,462
Pace Micro Technology PLC 24,500 23,780
130,742
INDUSTRIAL MACHINERY & EQUIPMENT - 1.0%
Molins PLC 3,100 20,233
Senior Engineering Group PLC 12,400 34,032
54,265
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 185,007
MEDIA & LEISURE - 6.7%
BROADCASTING - 0.5%
Scottish Television PLC 2,600 28,065
ENTERTAINMENT - 0.9%
Granada Group PLC 1,686 23,193
Wembley PLC 5,400 27,111
50,304
LODGING & GAMING - 1.2%
Ladbroke Group PLC Ord. 9,000 40,214
Millennium & Copthorne Hotels PLC (a) 3,900 25,095
65,309
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
MEDIA & LEISURE - CONTINUED
PUBLISHING - 2.7%
Bemrose 5,970 $ 39,963
EMAP PLC 3,000 43,076
Pearson PLC 5,300 69,182
152,221
RESTAURANTS - 1.4%
Allied Domecq PLC 10,000 81,416
TOTAL MEDIA & LEISURE 377,315
NONDURABLES - 12.1%
BEVERAGES - 2.1%
Greenalls Group PLC 4,800 28,356
Scottish & Newcastle Brewers PLC 3,800 42,893
Whitbread & Co. PLC Class A 3,600 48,016
119,265
FOODS - 5.5%
Grand Metropolitan PLC 10,000 90,034
Hazlewood Foods PLC Ord. 12,100 27,944
Man (E D & F) Group PLC 17,000 58,321
Tomkins PLC Ord. 16,139 82,646
Unigate PLC 5,000 48,280
307,225
HOUSEHOLD PRODUCTS - 1.8%
Mcbride PLC 11,000 31,847
Oriflame International SA (a) 1,900 15,103
Scholl PLC 5,000 23,178
Unilever PLC Ord. 4,000 29,721
99,849
TOBACCO - 2.7%
BAT Industries PLC Ord. 11,653 101,415
Gallaher Group PLC 11,000 52,464
153,879
TOTAL NONDURABLES 680,218
RETAIL & WHOLESALE - 9.1%
APPAREL STORES - 0.3%
Headlam Sims and Coggins PLC Class L 3,300 18,335
GENERAL MERCHANDISE STORES - 2.6%
Kingfisher PLC 4,678 67,170
Marks & Spencer Ltd. Ord. (a) 8,000 80,997
148,167
GROCERY STORES - 4.1%
Albert Fisher Group PLC Ord. 36,900 22,848
Asda Group PLC 9,000 23,345
Geest PLC 3,000 18,626
Iceland Group PLC 11,600 23,683
Somerfield PLC 8,700 27,954
Sainsbury (J.) PLC Ord. 8,800 73,266
Tesco PLC Ord. 5,000 39,934
229,656
RETAIL & WHOLESALE, MISCELLANEOUS - 1.6%
Great Universal Stores PLC Ord. Class A 4,900 57,934
Wickes PLC (a) 9,200 33,718
91,652

SHARES VALUE (NOTE 1)
TRADING COMPANIES - 0.5%
Inchcape PLC Ord. 7,500 $ 27,362
TOTAL RETAIL & WHOLESALE 515,172
SERVICES - 5.3%
ADVERTISING - 1.0%
Aegis Group PLC 23,500 23,990
Abbott Mead Vickers PLC 2,300 13,664
Cordiant PLC 9,400 19,349
57,003
PRINTING - 0.7%
Waddington PLC 9,000 36,298
SERVICES - 3.6%
Business Post Group PLC 5,100 45,235
Davis Service Group 9,300 43,111
De la Rue PLC 2,800 19,821
Flextech PLC 200 1,958
Hays PLC 4,600 53,887
Securicor Group PLC 8,600 38,571
202,583
TOTAL SERVICES 295,884
TECHNOLOGY - 0.8%
COMPUTER SERVICES & SOFTWARE - 0.5%
Micro Focus Group (a) 800 27,512
COMPUTERS & OFFICE EQUIPMENT - 0.3%
Psion PLC 2,000 15,062
TOTAL TECHNOLOGY 42,574
TRANSPORTATION - 1.7%
SHIPPING - 1.7%
Peninsular & Oriental Steam
Navigation Co. 8,300 95,841
UTILITIES - 9.1%
CELLULAR - 1.6%
Vodafone Group PLC 16,445 89,580
ELECTRIC UTILITY - 1.1%
National Grid Co. PLC 13,180 61,979
TELEPHONE SERVICES - 4.5%
British Telecommunications PLC Ord. 23,000 174,362
Cable & Wireless PLC Ord. 9,800 78,065
252,427
WATER - 1.9%
South West Water PLC Ord. 3,600 51,330
Yorkshire Water PLC 7,426 57,725
109,055
TOTAL UTILITIES 513,041
TOTAL COMMON STOCKS
(Cost $4,840,569) 5,399,243
CASH EQUIVALENTS - 4.1%
SHARES VALUE (NOTE 1)
Taxable Central Cash Fund (b)
(Cost $232,088) 232,088 $ 232,088
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $5,072,657) $ 5,631,331
LEGEND
(a) Non-income producing
(b) At period end, the seven-day yield on the Taxable Central Cash
Fund was 5.64%. The yield refers to the income earned by investing in
the fund over the seven-day period, expressed as an annual percentage.
OTHER INFORMATION
Purchases and sales of securities, other than short-term securities,
aggregated $6,536,786 and $4,539,039, respectively.
INCOME TAX INFORMATION
At October 31, 1997, the aggregate cost of investment securities for
income tax purposes was $5,072,711. Net unrealized appreciation
aggregated $558,620, of which $743,088 related to appreciated
investment securities and $184,468 related to depreciated investment
securities.
The fund hereby designates approximately $109,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
UNITED KINGDOM
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

OCTOBER 31, 1997

ASSETS

INVESTMENT IN SECURITIES, AT VALUE $
5,631,331
(COST $5,072,657) - SEE ACCOMPANYING SCHEDULE

RECEIVABLE FOR INVESTMENTS SOLD 188,638

RECEIVABLE FOR FUND SHARES SOLD 68,703

DIVIDENDS RECEIVABLE 32,790

INTEREST RECEIVABLE 1,130

RECEIVABLE FROM INVESTMENT ADVISER FOR EXPENSE REDUCTIONS 3,555

TOTAL ASSETS 5,926,147

LIABILITIES

PAYABLE TO CUSTODIAN BANK $ 10,368

PAYABLE FOR INVESTMENTS PURCHASED 100,364

PAYABLE FOR FUND SHARES REDEEMED 73,212

OTHER PAYABLES AND ACCRUED EXPENSES 33,341

TOTAL LIABILITIES 217,285

NET ASSETS $
5,708,862

NET ASSETS CONSIST OF:

PAID IN CAPITAL $
4,466,369

UNDISTRIBUTED NET INVESTMENT INCOME 115,342

ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 567,226

NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS 559,925

AND ASSETS AND LIABILITIES IN

FOREIGN CURRENCIES

NET ASSETS, FOR 401,616 $
5,708,862
SHARES OUTSTANDING

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($5,708,862 (DIVIDED BY) 401,616 SHARES) $14.21

MAXIMUM OFFERING PRICE PER SHARE (100/97.00 OF $14.21) $14.65

</TABLE>

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED OCTOBER 31, 1997

INVESTMENT INCOME $ 229,464
DIVIDENDS

INTEREST 16,090

245,554

LESS FOREIGN TAXES WITHHELD (22,918)

TOTAL INCOME 222,636

EXPENSES

MANAGEMENT FEE $ 38,193

TRANSFER AGENT FEES 17,072

ACCOUNTING FEES AND EXPENSES 60,007

NON-INTERESTED TRUSTEES' COMPENSATION 20

CUSTODIAN FEES AND EXPENSES 29,416

REGISTRATION FEES 18,179

AUDIT 33,836

LEGAL 27

REPORTS TO SHAREHOLDERS 928

MISCELLANEOUS 21

TOTAL EXPENSES BEFORE REDUCTIONS 197,699

EXPENSE REDUCTIONS (95,656) 102,043

NET INVESTMENT INCOME 120,593

REALIZED AND UNREALIZED GAIN (LOSS)
NET REALIZED GAIN (LOSS) ON:

INVESTMENT SECURITIES 580,596

FOREIGN CURRENCY TRANSACTIONS (76) 580,520

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON:

INVESTMENT SECURITIES 249,097

ASSETS AND LIABILITIES IN 799 249,896
FOREIGN CURRENCIES

NET GAIN (LOSS) 830,416

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 951,009

OTHER INFORMATION $ 26,135
SALES CHARGES PAID TO FDC

EXPENSE REDUCTIONS $ 359
CUSTODIAN CREDITS

FMR REIMBURSEMENT 95,297

$ 95,656

</TABLE>

STATEMENT OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
1997 OF OPERATIONS) TO
OCTOBER 31,
1996

OPERATIONS $ 120,593 $
33,364
NET INVESTMENT INCOME

NET REALIZED GAIN (LOSS) 580,520
60,786

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) 249,896
310,029

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 951,009
404,179

DISTRIBUTIONS TO SHAREHOLDERS (35,705)
(6,442)
FROM NET INVESTMENT INCOME

FROM NET REALIZED GAIN (54,931) -

TOTAL DISTRIBUTIONS (90,636)
(6,442)

SHARE TRANSACTIONS 5,571,480
3,047,222
NET PROCEEDS FROM SALES OF SHARES

REINVESTMENT OF DISTRIBUTIONS 90,558
6,442

COST OF SHARES REDEEMED (3,481,394)
(799,432)

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 2,180,644
2,254,232

REDEMPTION FEES 12,334
3,542

TOTAL INCREASE (DECREASE) IN NET ASSETS 3,053,351
2,655,511

NET ASSETS

BEGINNING OF PERIOD 2,655,511 -

END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $115,342 AND $26,710, RESPECTIVELY) $ 5,708,862 $
2,655,511

OTHER INFORMATION

SOLD 437,185
295,808

ISSUED IN REINVESTMENT OF DISTRIBUTIONS 7,700 651

REDEEMED (266,573)
(73,155)

NET INCREASE (DECREASE) 178,312
223,304

</TABLE>

<TABLE>
<CAPTION>
<S> <C> <C>
SEE ACCOMPANYING NOTES WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.

</TABLE>

FINANCIAL HIGHLIGHTS
YEAR ENDED NOVEMBER 1, 1995
OCTOBER 31, (COMMENCEMENT
OF OPERATIONS) TO
OCTOBER 31,

SELECTED PER-SHARE DATA 1997 1996

<TABLE>
<CAPTION>
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.89 $ 10.00

INCOME FROM INVESTMENT OPERATIONS

NET INVESTMENT INCOME .31 C .16

NET REALIZED AND UNREALIZED GAIN (LOSS) 2.31 1.75

TOTAL FROM INVESTMENT OPERATIONS 2.62 1.91

LESS DISTRIBUTIONS

FROM NET INVESTMENT INCOME (.13) (.04)

FROM NET REALIZED GAIN (.20) -

TOTAL DISTRIBUTIONS (.33) (.04)

REDEMPTION FEES ADDED TO PAID IN CAPITAL .03 .02

NET ASSET VALUE, END OF PERIOD $ 14.21 $ 11.89

TOTAL RETURN A, B 22.87% 19.38%

RATIOS AND SUPPLEMENTAL DATA

NET ASSETS, END OF PERIOD (000 OMITTED) $ 5,709 $ 2,656

RATIO OF EXPENSES TO AVERAGE NET ASSETS 2.00% D 2.00% D

RATIO OF EXPENSES TO AVERAGE NET ASSETS AFTER EXPENSE REDUCTIONS 1.99% E 1.97% E

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS 2.36% 1.62%

PORTFOLIO TURNOVER RATE 96% 50%

AVERAGE COMMISSION RATE F $ .0105 $ .0086

A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS). B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME
SALES CHARGE. C NET INVESTMENT INCOME PER SHARE
HAS BEEN CALCULATED BASED ON AVERAGE SHARES OUTSTANDING DURING THE
PERIOD. D FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES
DURING THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE
RATIO WOULD HAVE BEEN HIGHER (SEE NOTE 7 OF NOTES
TO FINANCIAL STATEMENTS). E FMR OR THE FUND HAS ENTERED INTO
VARYING ARRANGEMENTS WITH THIRD PARTIES WHO EITHER PAID OR REDUCED
A PORTION OF THE FUND'S EXPENSES (SEE NOTE 7 OF NOTES TO FINANCIAL
STATEMENTS). F A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE
COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS
ARE CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND
TO FUND DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS
MARKETS WHERE TRADING PRACTICES AND COMMISSION RATE STRUCTURES
MAY DIFFER.

</TABLE>

NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED OCTOBER 31, 1997

1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Canada Fund, Fidelity Emerging Markets Fund, Fidelity Europe
Fund, Fidelity Europe Capital Appreciation Fund, Fidelity France Fund,
Fidelity Germany Fund, Fidelity Hong Kong and China Fund, Fidelity
Japan Fund, Fidelity Japan Small Companies Fund, Fidelity Latin
America Fund, Fidelity Nordic Fund, Fidelity Pacific Basin Fund,
Fidelity Southeast Asia Fund and Fidelity United Kingdom Fund (the
funds) are funds of Fidelity Investment Trust (the trust). The trust
is registered under the Investment Company Act of 1940, as amended
(the 1940 Act), as an open-end management investment company organized
as a Massachusetts business trust. Each fund is authorized to issue an
unlimited number of shares. The financial statements have been
prepared in conformity with generally accepted accounting principles
which permit management to make certain estimates and assumptions at
the date of the financial statements. The following summarizes the
significant accounting policies of the funds:
SECURITY VALUATION. Securities for which quotations are readily
available are valued at the last sale price, or if no sale price, at
the closing bid price in the principal market in which such securities
are normally traded. If events which are expected to materially affect
the value of securities occur after the close of a principal market in
which those securities are traded, then those securities are valued at
their fair value as determined in good faith under consistently
applied procedures under the general supervision of the Board of
Trustees ("fair value"). Securities (including restricted securities)
for which quotations are not readily available are valued primarily
using dealer-supplied valuations or at their fair value. Short-term
securities with remaining maturities of sixty days or less for which
quotations are not readily available are valued at amortized cost or
original cost plus accrued interest, both of which approximate current
value. Equity securities that have reached the limit for aggregate
foreign ownership may trade at a premium to the local share price. If
the broker-quoted premium is not readily available as a result of
limited share activity, the securities are valued at the last sale
price of the local shares in the principal market in which securities
are normally traded.
FOREIGN CURRENCY TRANSLATION. The accounting records of the funds are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Income
receipts and expense payments are translated into U.S. dollars at the
prevailing exchange rate on the respective dates of the transactions.
Purchases and sales of securities are translated into U.S. dollars at
the contractual currency exchange rates established at the time of
each trade.
Net realized gains and losses on foreign currency transactions
represent net gains and losses from sales and maturities of foreign
currency contracts, disposition of foreign currencies, and the
difference between the amount of net investment income
accrued and the U.S. dollar amount actually received. The effects of
changes in foreign currency exchange rates on investments in
securities are included with the net realized and unrealized gain or
loss on investment securities.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
U.S. federal income taxes to the extent that it distributes
substantially all of its taxable income for its fiscal year. Each fund
may be subject to foreign taxes on income and gains on investments
which are accrued based upon each fund's understanding of the tax
rules and regulations that exist in the markets in which they invest.
Each fund accrues such taxes as applicable. The schedules of
investments include information regarding income taxes under the
caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend
date, except certain dividends from foreign securities where the
ex-dividend date may have passed, are recorded as soon as the funds
are informed of the ex-dividend date. Non-cash dividends included in
dividend income, if any, are recorded at the fair market value of the
securities received. Interest income is accrued as earned. Investment
income is recorded net of foreign taxes withheld where recovery of
such taxes is uncertain.
EXPENSES. Most expenses of the trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
between the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date. Certain foreign currency gains (losses), if
applicable, are taxable as ordinary income and, therefore, increase
(decrease) taxable ordinary income available for distribution.
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for litigation proceeds, futures and options transactions,
foreign currency transactions, passive foreign investment companies
(PFIC), non-taxable dividends, net operating losses, capital loss
carryforwards and losses deferred due to wash sales, futures and
options and excise tax regulations. Certain funds also utilized
earnings and profits distributed to shareholders on redemption of
shares as a part of the dividends paid deduction for income tax
purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Undistributed net investment income, accumulated net investment loss,
distributions in excess of net investment income and accumulated
undistributed net realized gain (loss) on investments and foreign
currency transactions may include temporary book and tax basis
differences which will reverse in a subsequent period. Any taxable
income or gain remaining at fiscal year end is distributed in the
following year.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
REDEMPTION FEES. Shares held in Canada, Emerging Markets, France,
Germany, Hong Kong and China, Japan, Japan Small Companies, Latin
America, Nordic, Southeast Asia and United Kingdom less than 90 days
are subject to a redemption fee equal to 1.50% of the proceeds of the
redeemed shares. Shares held in Europe, Europe Capital Appreciation,
and Pacific Basin less than 90 days are subject to a redemption fee
equal to 1.00% of the proceeds of the redeemed shares. These fees,
which are retained by the funds, are accounted for as an addition to
paid in capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. Certain funds use foreign currency
contracts to facilitate transactions in foreign-denominated
securities. Losses may arise from changes in the value of the foreign
currency or if the counterparties do not perform under the contracts'
terms. The U.S. dollar value of foreign currency contracts is
determined using contractual currency exchange rates established at
the time of each trade. The cost of the foreign currency contracts is
included in the cost basis of the associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission (the SEC), the funds, along with
other affiliated entities of Fidelity Management & Research Company
(FMR), may transfer uninvested cash balances into one or more joint
trading accounts. These balances are invested in one or more
repurchase agreements for U.S. Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
securities are transferred to an account of the funds, or to the Joint
Trading Account, at a bank custodian. The securities are
marked-to-market daily and maintained at a value at least equal to the
principal amount of the repurchase agreement (including accrued
interest). FMR, the funds' investment adviser, is responsible for
determining that the value of the underlying securities remains in
accordance with the market value requirements stated above.
TAXABLE CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the SEC, the funds may invest in the Taxable Central Cash Fund (the
Cash Fund) managed by FMR Texas, Inc., an affiliate of FMR. The Cash
Fund is an open-end money market fund available only to investment
companies and other accounts managed by FMR and its affiliates. The
Cash Fund seeks preservation of capital, liquidity, and current income
by investing in U.S. Treasury securities and repurchase agreements for
these securities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
received by the funds are recorded as interest income in the
accompanying financial statements.
INTERFUND LENDING PROGRAM. Pursuant to an Exemptive Order issued by
the SEC, the funds, along with other registered investment companies
having management contracts with FMR, may participate in an interfund
lending program. This program provides an alternative credit facility
allowing the funds to borrow from, or lend money to, other
participating funds.
FUTURES CONTRACTS. Certain funds may use futures contracts to manage
their exposure to the stock market and to fluctuations in interest
rates. Buying futures tends to increase a fund's exposure to the
underlying instrument, while selling futures tends to decrease a
fund's exposure to the underlying instrument or hedge other fund
investments. Futures contracts involve, to varying degrees, risk of
loss in excess of the futures variation margin reflected in each
applicable fund's Statement of Assets and Liabilities. The underlying
face amount at value of any open futures contracts at period end is
shown in each applicable fund's schedule of investments under the
caption "Futures Contracts." This amount reflects each contract's
exposure to the underlying instrument at period end. Losses may arise
from changes in the value of the underlying instruments or if the
counterparties do not perform under the contracts' terms. Gains
(losses) are realized upon the expiration or closing of the futures
contracts. Futures contracts are valued at the settlement price
established each day by the board of trade or exchange on which they
are traded.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments.
3. PURCHASES AND SALES OF INVESTMENTS.
Information regarding purchases and sales of securities (other than
short-term securities), and the market value of futures contracts
opened and closed, is included under the caption "Other Information"
at the end of each applicable fund's schedule of investments.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a
monthly basic fee that is calculated on the basis of a group fee rate
plus a fixed individual fund fee rate applied to the average net
assets of each fund. The group fee rate is the weighted average of a
series of rates and is based on the monthly average net assets of all
the mutual funds advised by FMR. The rates ranged from .2500% to
.5200% for the period for the funds. The annual individual fund fee
rate is .45% for each fund. In the event that these rates were lower
than the contractual rates in effect during the period, FMR
voluntarily implemented the above rates, as they resulted in the same
or a lower management fee.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
The basic fee for Canada, Europe, Europe Capital Appreciation, Japan,
Pacific Basin, and Southeast Asia is subject to a performance
adjustment (up to a maximum of (plus/minus).20% of the fund's average
net assets over the performance period) based on each fund's
investment performance as compared to the appropriate index over a
specified period of time.
For the period, each fund's management fee was equivalent to the
following annual rates expressed as a percentage of average net assets
after the performance adjustment, if applicable:
Canada .39%
Emerging Markets .75%
Europe .78%
Europe Capital Appreciation .65%
France .75%
Germany .75%
Hong Kong and China .75%
Japan .93%
Japan Small Companies .75%
Latin America .75%
Nordic .75%
Pacific Basin .70%
Southeast Asia .76%
United Kingdom .75%
SUB-ADVISER FEE. FMR, on behalf of the funds, entered into
sub-advisory agreements with Fidelity Management & Research (U.K.)
Inc., Fidelity Management & Research (Far East) Inc., Fidelity
International Investment Advisors (FIIA), and Fidelity Investment
Japan Ltd. (Emerging Markets, Hong Kong and China, Japan, Japan Small
Companies, Pacific Basin and Southeast Asia funds only.). In addition,
FIIA entered into a sub-advisory agreement with its subsidiary,
Fidelity International Investment Advisors (U.K.) Limited
(FIIA(U.K.)L). Under the sub-advisory arrangements, FMR may receive
investment advice and research services and may grant the sub-advisers
investment management authority to buy and sell securities. FMR pays
its sub-advisers either a portion of its management fee or a fee based
on costs incurred for these services. FIIA pays FIIA(U.K.)L a fee
based on costs incurred for either service.
SALES LOAD. Fidelity Distributors Corporation (FDC), an affiliate of
FMR, is the general distributor of the fund. FDC receives a sales
charge of up to 3% for selling shares of each fund. Shares of Canada,
Europe, and Pacific Basin purchased prior to October 12, 1990, are
subject to a 1% deferred sales charge upon redemption. The amounts
received by FDC for sales charges and deferred sales charges are shown
under the caption "Other Information" on each fund's Statement of
Operations.
TRANSFER AGENT FEES. Fidelity Service Company, Inc. (FSC), an
affiliate of FMR, is the funds' transfer, dividend disbursing and
shareholder servicing agent. FSC receives account fees and asset-based
fees that vary according to account size and type of account. FSC pays
for typesetting, printing and mailing of all shareholder reports,
except proxy statements.
For the period, each fund's transfer agent fees were equivalent to the
following annual rates expressed as a percentage of average net
assets:
Canada .34%
Emerging Markets .33%
Europe .26%
Europe Capital Appreciation .27%
France .37%
Germany .33%
Hong Kong and China .32%
Japan .31%
Japan Small Companies .33%
Latin America .27%
Nordic .32%
Pacific Basin .41%
Southeast Asia .31%
United Kingdom .33%
ACCOUNTING FEES. FSC maintains each fund's accounting records. The fee
is based on the level of average net assets for the month plus
out-of-pocket expenses.
BROKERAGE COMMISSIONS. Certain funds placed a portion of their
portfolio transactions with brokerage firms which are affiliates of
FMR. The commissions paid to these affiliated firms are shown under
the caption "Other Information" at the end of each applicable fund's
schedule of investments.
5. INTERFUND LENDING PROGRAM.
Certain funds participated in the interfund lending program as
borrowers. The maximum loan and the average daily loan balances during
the periods for which loans were outstanding are shown under the
caption "Other Information" at the end of each applicable fund's
schedule of investments.
6. BANK BORROWINGS.
Each fund is permitted to have bank borrowings for temporary or
emergency purposes to fund shareholder redemptions. Each fund has
established borrowing arrangements with certain banks. Under the most
restrictive arrangement, each fund must pledge to the bank securities
having a market value in excess of 220% of the total bank borrowings.
The interest rate on the borrowings is the bank's base rate, as
revised from time to time. Information regarding a fund's
participation in the program is included under the caption "Other
Information" at the end of each applicable fund's schedule of
investments.
7. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse certain fund's operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses) above an annual rate of 2.00% of average net assets.
7. EXPENSE REDUCTIONS - CONTINUED
FMR has directed certain portfolio trades to brokers who paid a
portion of certain funds' expenses.
In addition, certain funds have entered into arrangements with their
custodian and transfer agent whereby credits realized on uninvested
cash balances were used to offset a portion of each applicable fund's
expenses.
For the period, the reductions under these arrangements are shown
under the caption "Other Information" on each applicable fund's
Statement of Operations.
8. BENEFICIAL INTEREST.
At the end of the period, FMR and its affiliates were record owners of
more than 5% of the outstanding shares of the following funds:
FMR
FUND % OF OWNERSHIP
France 25
Germany 11
Japan 9
Japan Small Companies 23
United Kingdom 25
9. TRANSACTIONS WITH AFFILIATED COMPANIES.
An affiliated company is a company which the fund has ownership of at
least 5% of the voting securities. Information regarding transactions
with affiliated companies is included in "Other Information" at the
end of each applicable fund's schedule of investments.
10. LITIGATION.
The Latin America Fund is engaged in litigation against the obligor on
the inflation adjusted debt of Siderurgica Brasileiras SA, contesting
the calculation of the principal adjustment. The probability of
success of this litigation cannot be predicted and the amount of
recovery cannot be estimated. Any recovery from this litigation would
inure to the benefit of the fund. As of period end, the Latin America
Fund no longer holds Siderurgica Brasileiras SA debt securities.
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Investment Trust and the Shareholders of:
Fidelity Canada Fund,
Fidelity Emerging Markets Fund,
Fidelity Europe Fund,
Fidelity Japan Fund,
Fidelity Pacific Basin Fund:
We have audited the accompanying statements of assets and liabilities
of Fidelity Investment Trust: Fidelity Canada Fund, Fidelity Emerging
Markets Fund, Fidelity Europe Fund, Fidelity Japan Fund, and Fidelity
Pacific Basin Fund, including the schedules of portfolio investments,
as of October 31, 1997, and the related statements of operations for
the year then ended, the statements of changes in net assets for each
of the two years in the period then ended and the financial highlights
for each of the periods indicated therein. These financial statements
and financial highlights are the responsibility of the Funds'
management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of October 31, 1997 by
correspondence with the custodians and brokers. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of Fidelity Investment Trust: Fidelity Canada Fund,
Fidelity Emerging Markets Fund, Fidelity Europe Fund, Fidelity Japan
Fund, and Fidelity Pacific Basin Fund as of October 31, 1997, the
results of their operations for the year then ended, the changes in
their net assets for each of the two years in the period then ended,
and the financial highlights for each of the periods indicated
therein, in conformity with generally accepted accounting principles.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
December 16, 1997
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees of Fidelity Investment Trust and the Shareholders of:
Fidelity Europe Capital Appreciation Fund,
Fidelity France Fund,
Fidelity Germany Fund,
Fidelity Hong Kong and China Fund,
Fidelity Japan Small Companies Fund,
Fidelity Latin America Fund,
Fidelity Nordic Fund,
Fidelity Southeast Asia Fund,
Fidelity United Kingdom Fund:

In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Fidelity Europe Capital Appreciation Fund, Fidelity France Fund,
Fidelity Germany Fund, Fidelity Hong Kong and China Fund, Fidelity
Japan Small Companies Fund, Fidelity Latin America Fund, Fidelity
Nordic Fund, Fidelity Southeast Asia Fund and Fidelity United Kingdom
Fund (funds of Fidelity Investment Trust) at October 31, 1997, the
results of their operations for the year then ended, and the changes
in their net assets and the financial highlights for the periods
indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the
responsibility of the Fidelity Investment Trust's management; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation
of securities at October 31, 1997 by correspondence with the
custodians and the application of alternative auditing procedures
where securities purchased were not yet received by the custodians,
provide a reasonable basis for the opinion expressed above.
/s/ PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Boston, Massachusetts
December 18, 1997
DISTRIBUTIONS

NORDIC 1%

A percentage of the dividends distributed during the fiscal year for
the following funds were derived from interest on U.S. Government
securities which is generally exempt from state income tax.
JAPAN 1.41%

PACIFIC BASIN 1.06%

The amounts per share which represent income derived from sources
within, and taxes paid to, foreign countries or possessions of the
United States are as follows:
PAY DATE INCOME TAXES
Canada 12/9/96 $.219 $.032
Emerging Markets 12/16/96 $.302 $.052
Europe 12/9/96 $.303 $.063
Europe Capital Appreciation 12/16/96 $.341 $.040
France 12/9/96 $.253 $.040
Germany 12/16/96 $.117 $.014
Hong Kong and China 12/9/96 $.133 $.003
Japan 12/9/96 $.027 $.017
Japan Small Companies 12/16/96 $.038 $.007
Latin America 12/9/96 $.269 $.039
Nordic 12/16/96 $.076 $.009
Pacific Basin 12/16/96 $.104 $.024
Southeast Asia 12/9/96 $.196 $.026
United Kingdom 12/9/96 $.194 $.027
The funds will notify shareholders in January 1998 of amounts for use
in preparing 1997 income tax returns.
PROXY VOTING RESULTS

A special meeting of the funds' shareholders was held on September 17,
1997. The results of votes taken among shareholders on proposals are
listed below.
PROPOSAL 1
To elect as Trustees the following twelve nominees.
# OF % OF
SHARES VOTED SHARES VOTED
RALPH F. COX
Affirmative 307,469,095.652 87.117
Withheld 45,467,029.324 12.883
TOTAL 352,936,124.976 100.000
PHYLLIS BURKE DAVIS
Affirmative 307,387,377.836 87.094
Withheld 45,548,747.140 12.906
TOTAL 352,936,124.976 100.000
ROBERT M. GATES
Affirmative 307,219,404.498 87.047
Withheld 45,716,720.478 12.953
TOTAL 352,936,124.976 100.000
EDWARD C. JOHNSON 3D
Affirmative 307,304,255.082 87.071
Withheld 45,631,869.894 12.929
TOTAL 352,936,124.976 100.000
E. BRADLEY JONES
Affirmative 307,163,389.202 87.031
Withheld 45,772,735.774 12.969
TOTAL 352,936,124.976 100.000
DONALD J. KIRK
Affirmative 307,589,965.173 87.152
Withheld 45,346,159.803 12.848
TOTAL 352,936,124.976 100.000
# OF % OF
SHARES VOTED SHARES VOTED
PETER S. LYNCH
Affirmative 307,609,611.247 87.157
Withheld 45,326,513.729 12.843
TOTAL 352,936,124.976 100.000
WILLIAM O. MCCOY
Affirmative 307,616,784.105 87.159
Withheld 45,319,340.871 12.841
TOTAL 352,936,124.976 100.000
GERALD C. MCDONOUGH
Affirmative 307,384,278.082 87.093
Withheld 45,551,846.894 12.907
TOTAL 352,936,124.976 100.000
MARVIN L. MANN
Affirmative 307,596,505.166 87.154
Withheld 45,339,619.810 12.846
TOTAL 352,936,124.976 100.000
ROBERT C. POZEN
Affirmative 307,465,181.656 87.116
Withheld 45,470,943.320 12.884
TOTAL 352,936,124.976 100.000
THOMAS R. WILLIAMS
Affirmative 307,326,062.668 87.077
Withheld 45,610,062.308 12.923
TOTAL 352,936,124.976 100.000
PROPOSAL 2
To ratify the selection of Coopers & Lybrand L.L.P. and Price
Waterhouse LLP as independent accountants of the trust.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 297,481,581.663 84.288

AGAINST 4,739,203.560 1.342

ABSTAIN 50,715,339.753 14.370

TOTAL 352,936,124.976 100.000

AGAINST 15,944,801.447 4.637

ABSTAIN 53,353,237.539 15.513

TOTAL 343,917,749.976 100.000

BROKER NON-VOTES 9,018,375.000

PROPOSAL CANADA # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,429,192.608 80.848

AGAINST 176,304.973 5.868

ABSTAIN 399,125.901 13.284

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EMERGING MARKETS # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,949,039.552 74.037

AGAINST 1,309,183.495 4.416

ABSTAIN 6,387,709.364 21.547

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL EUROPE # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 13,038,008.817 81.999

AGAINST 709,543.695 4.463

ABSTAIN 2,152,613.338 13.538

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL EUROPE CAP. APP. # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,006,697.702 88.966

AGAINST 535,582.742 3.969

ABSTAIN 953,487.379 7.065

TOTAL 13,495,767.823 100.000

BROKER NON-VOTES 203,719.000

PROPOSAL FRANCE # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 259,447.119 89.100

AGAINST 24,188.855 8.307

ABSTAIN 7,550.063 2.593

TOTAL 291,186.037 100.000

BROKER NON-VOTES 1,027.000

PROPOSAL GERMANY # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 434,482.117 80.483

AGAINST 25,763.475 4.772

ABSTAIN 79,598.661 14.745

TOTAL 539,844.253 100.000

BROKER NON-VOTES 6,409.000

PROPOSAL HONG KONG AND CHINA # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 6,999,108.575 86.923

AGAINST 288,102.500 3.578

ABSTAIN 764,886.148 9.499

TOTAL 8,052,097.223 100.000

BROKER NON-VOTES 240,238.000

PROPOSAL JAPAN # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,198,229.614 81.359

AGAINST 491,023.390 3.275

ABSTAIN 2,303,862.059 15.366

TOTAL 14,993,115.063 100.000

BROKER NON-VOTES 463,178.000

PROPOSAL JAPAN SMALL CO. # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 8,450,976.815 88.900

AGAINST 630,693.789 6.635

ABSTAIN 424,475.055 4.465

TOTAL 9,506,145.659 100.000

BROKER NON-VOTES 105,193.000

PROPOSAL LATIN AMERICA # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 23,738,018.311 79.491

AGAINST 1,484,498.891 4.971

ABSTAIN 4,639,916.511 15.538

TOTAL 29,862,433.713 100.000

BROKER NON-VOTES 1,530,125.000

PROPOSAL NORDIC # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,436,100.136 91.474

AGAINST 121,084.501 4.546

ABSTAIN 105,981.461 3.980

TOTAL 2,663,166.098 100.000

BROKER NON-VOTES 36,150.000

PROPOSAL PACIFIC BASIN # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,820,871.019 75.722

AGAINST 422,989.726 4.096

ABSTAIN 2,084,480.619 20.182

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL SOUTHEAST ASIA # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 13,102,923.369 75.587

AGAINST 712,050.979 4.108

ABSTAIN 3,519,935.873 20.305

TOTAL 17,334,910.221 100.000

BROKER NON-VOTES 638,041.000

PROPOSAL UNITED KINGDOM # OF FUND % OF FUND
SHARES VOTED SHARES VOTED
AFFIRMATIVE 246,839.100 91.742

AGAINST 12,922.803 4.803

ABSTAIN 9,296.680 3.455

TOTAL 269,058.583 100.000

BROKER NON-VOTES 1,420.000

AGAINST 14,687,878.962 4.271

ABSTAIN 55,408,780.356 16.111

TOTAL 343,917,749.976 100.000

BROKER NON-VOTES 9,018,375.000

PROPOSAL 5
To amend the Declaration of Trust to clarify that the Trustees may
authorize the investment of all of a fund's assets in another open-end
investment company with substantially the same investment objective
and policies.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 253,910,627.527 73.810

AGAINST 33,659,944.597 9.785

ABSTAIN 56,433,204.852 16.405

TOTAL 344,003,776.976 100.000

BROKER NON-VOTES 8,932,348.000

PROPOSAL 6
To adopt a new fundamental investment policy for the fund that would
permit it to invest all of its assets in another open-end investment
company managed by FMR or an affiliate with substantially the same
investment objective and policies.
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,233,393.132 74.332

AGAINST 333,321.148 11.093

ABSTAIN 437,909.202 14.575

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EMERGING MARKETS # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,491,314.826 69.120

AGAINST 2,611,945.077 8.811

ABSTAIN 6,542,672.508 22.069

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,948,009.251 75.144

AGAINST 1,695,331.793 10.662

ABSTAIN 2,256,824.806 14.194

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL EUROPE CAP. APP. # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 10,936,524.227 81.037

AGAINST 1,460,597.999 10.822

ABSTAIN 1,098,645.597 8.141

TOTAL 13,495,767.823 100.000

BROKER NON-VOTES 203,719.000

PROPOSAL JAPAN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,467,600.660 76.486

AGAINST 1,125,006.942 7.503

ABSTAIN 2,400,507.461 16.011

TOTAL 14,993,115.063 100.000

BROKER NON-VOTES 463,178.000

PROPOSAL LATIN AMERICA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,222,945.701 71.069

AGAINST 3,645,954.386 12.209

ABSTAIN 4,993,533.626 16.722

TOTAL 29,862,433.713 100.000

BROKER NON-VOTES 1,530,125.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,281,733.485 70.502

AGAINST 903,689.986 8.750

ABSTAIN 2,142,917.893 20.748

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL SOUTHEAST ASIA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,996,179.205 69.202

AGAINST 1,662,451.025 9.591

ABSTAIN 3,676,279.991 21.207

TOTAL 17,334,910.221 100.000

BROKER NON-VOTES 638,041.000

PROPOSAL 7
To approve an amended management contract for the fund that would
reduce the management fee payable to FMR by the fund as FMR's assets
under management increase.
PROPOSAL EMERGING MARKETS # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,640,128.654 73.935

AGAINST 1,334,902.519 4.359

ABSTAIN 6,646,694.238 21.706

TOTAL 30,621,725.411 100.000

PROPOSAL FRANCE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 259,353.491 88.755

AGAINST 21,464.534 7.345

ABSTAIN 11,395.012 3.900

TOTAL 292,213.037 100.000

PROPOSAL GERMANY # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 433,718.337 79.399

AGAINST 25,736.938 4.711

ABSTAIN 86,797.978 15.890

TOTAL 546,253.253 100.000

PROPOSAL HONG KONG AND CHINA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 6,961,606.103 83.952

AGAINST 386,530.702 4.662

ABSTAIN 944,198.418 11.386

TOTAL 8,292,335.223 100.000

PROPOSAL JAPAN SMALL CO. # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 8,554,189.064 89.001

AGAINST 564,428.127 5.873

ABSTAIN 492,721.468 5.126

TOTAL 9,611,338.659 100.000

PROPOSAL LATIN AMERICA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 24,318,345.952 77.465

AGAINST 1,848,139.409 5.888

ABSTAIN 5,226,073.352 16.647

TOTAL 31,392,558.713 100.000

PROPOSAL NORDIC # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,391,586.915 88.600

AGAINST 129,491.007 4.797

ABSTAIN 178,238.176 6.603

TOTAL 2,699,316.098 100.000

PROPOSAL UNITED KINGDOM # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 249,345.995 92.187

AGAINST 5,125.886 1.895

ABSTAIN 16,006.702 5.918

TOTAL 270,478.583 100.000

PROPOSAL 8
To approve an amended management contract for the fund that would
reduce the management fee payable to FMR by the fund as FMR's assets
under management increase and would modify the performance adjustment
calculation to calculate the fund's investment performance and that of
its comparative index to the nearest 0.01%.
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,488,717.945 80.764

AGAINST 140,756.877 4.568

ABSTAIN 451,987.660 14.668

TOTAL 3,081,462.482 100.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 13,339,739.819 81.811

AGAINST 661,079.018 4.054

ABSTAIN 2,304,799.013 14.135

TOTAL 16,305,617.850 100.000

PROPOSAL EUROPE CAP. APP. # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,845,344.372 86.466

AGAINST 668,347.482 4.878

ABSTAIN 1,185,794.969 8.656

TOTAL 13,699,486.823 100.000

PROPOSAL JAPAN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,182,001.185 78.816

AGAINST 682,662.543 4.417

ABSTAIN 2,591,629.335 16.767

TOTAL 15,456,293.063 100.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 8,002,299.233 75.362

AGAINST 421,118.918 3.966

ABSTAIN 2,194,997.213 20.672

TOTAL 10,618,415.364 100.000

PROPOSAL SOUTHEAST ASIA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 13,251,256.642 73.729

AGAINST 880,570.328 4.899

ABSTAIN 3,841,124.251 21.372

TOTAL 17,972,951.221 100.000

PROPOSAL 9
To approve a new Sub-Advisory Agreement with Fidelity Investments
Japan Limited.
PROPOSAL EMERGING MARKETS # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,564,630.313 73.688

AGAINST 1,258,643.793 4.111

ABSTAIN 6,798,451.305 22.201

TOTAL 30,621,725.411 100.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 8,045,376.634 75.768

AGAINST 389,493.410 3.668

ABSTAIN 2,183,545.320 20.564

TOTAL 10,618,415.364 100.000

PROPOSAL 10
To amend Fidelity Europe Fund's fundamental investment objective and
to modify certain fundamental investment policies to provide that the
fund will invest in Europe rather than western Europe.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 13,121,785.522 82.526

AGAINST 629,212.218 3.957

ABSTAIN 2,149,168.110 13.517

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL 11
To eliminate certain of Fidelity Pacific Basin Fund's fundamental
investment policies and to replace certain policies with
non-fundamental policies.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,378,461.187 71.439

AGAINST 696,938.803 6.748

ABSTAIN 2,252,941.374 21.813

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 12
To replace the fundamental investment policy concerning investment for
temporary defensive purposes with a non-fundamental policy.
PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,644,529.088 79.525

AGAINST 885,410.716 5.568

ABSTAIN 2,370,226.046 14.907

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,484,165.082 72.462

AGAINST 611,658.199 5.923

ABSTAIN 2,232,518.083 21.615

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 13
To amend the diversification limitation to exclude "securities of
other investment companies" from issuer diversification limits.
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,366,277.234 78.755

AGAINST 200,629.966 6.677

ABSTAIN 437,716.282 14.568

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EMERGING MARKETS # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 21,170,081.612 71.410

AGAINST 1,830,519.909 6.174

ABSTAIN 6,645,330.890 22.416

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,604,420.141 79.272

AGAINST 1,026,101.794 6.454

ABSTAIN 2,269,643.915 14.274

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL EUROPE CAP. APP. # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,370,703.094 84.254

AGAINST 1,020,640.383 7.563

ABSTAIN 1,104,424.346 8.183

TOTAL 13,495,767.823 100.000

BROKER NON-VOTES 203,719.000

PROPOSAL JAPAN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 11,646,341.227 77.678

AGAINST 881,122.278 5.877

ABSTAIN 2,465,651.558 16.445

TOTAL 14,993,115.063 100.000

BROKER NON-VOTES 463,178.000

PROPOSAL LATIN AMERICA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 22,301,072.268 74.679

AGAINST 2,495,491.454 8.357

ABSTAIN 5,065,869.991 16.964

TOTAL 29,862,433.713 100.000

BROKER NON-VOTES 1,530,125.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,523,798.318 72.846

AGAINST 633,954.172 6.138

ABSTAIN 2,170,588.874 21.016

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL SOUTHEAST ASIA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,409,460.823 71.587

AGAINST 1,160,548.501 6.694

ABSTAIN 3,764,900.897 21.719

TOTAL 17,334,910.221 100.000

BROKER NON-VOTES 638,041.000

PROPOSAL 14
To make explicit the ability of the fund to purchase any security or
instrument backed by real estate or real estate interests and any
security of companies engaged in the real estate business. Also to
eliminate the restriction that securities backed by real estate must
be marketable.
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,365,185.965 78.718

AGAINST 199,505.089 6.640

ABSTAIN 439,932.428 14.642

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,446,001.477 78.276

AGAINST 1,149,501.008 7.229

ABSTAIN 2,304,663.365 14.495

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,486,020.012 72.480

AGAINST 649,393.589 6.288

ABSTAIN 2,192,927.763 21.232

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 15
To eliminate Fidelity Emerging Markets Fund's fundamental investment
limitation on short sales and adopt a similar non-fundamental
investment limitation.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,695,149.945 69.808

AGAINST 2,237,587.140 7.547

ABSTAIN 6,713,195.326 22.645

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL 16
To replace Fidelity Emerging Markets Fund's fundamental investment
limitation on margin purchases with a similar non-fundamental
investment limitation.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,240,861.691 68.275

AGAINST 2,696,788.047 9.097

ABSTAIN 6,708,282.673 22.628

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL 17
To amend the borrowing limitation to require a reduction in borrowing
if borrowings exceed the 331/3% limit for any reason rather than
solely because of a decline in net assets.
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,299,328.542 76.526

AGAINST 256,181.814 8.527

ABSTAIN 449,113.126 14.947

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EMERGING MARKETS # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,615,764.648 69.540

AGAINST 2,290,121.815 7.725

ABSTAIN 6,740,045.948 22.735

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,352,282.636 77.687

AGAINST 1,171,853.287 7.370

ABSTAIN 2,376,029.927 14.943

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,385,332.247 71.506

AGAINST 735,065.592 7.116

ABSTAIN 2,207,943.525 21.378

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 18
To clarify the fundamental investment policy with respect to the
underwriting of securities.
PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,464,978.207 78.395

AGAINST 1,014,682.786 6.382

ABSTAIN 2,420,504.857 15.223

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,434,502.834 71.982

AGAINST 661,046.578 6.400

ABSTAIN 2,232,791.952 21.618

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 19
To standardize the language of the limitation on industry
concentration and modify it to refer to "companies with principal
business activities in the same industry" rather than "issuers in the
same industry."
PROPOSAL CANADA # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 2,315,777.597 77.074

AGAINST 240,667.729 8.010

ABSTAIN 448,178.156 14.916

TOTAL 3,004,623.482 100.000

BROKER NON-VOTES 76,839.000

PROPOSAL EUROPE # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 12,524,244.641 78.768

AGAINST 1,091,800.201 6.867

ABSTAIN 2,284,121.008 14.365

TOTAL 15,900,165.850 100.000

BROKER NON-VOTES 405,452.000

PROPOSAL PACIFIC BASIN # OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 7,492,784.443 72.546

AGAINST 638,388.155 6.181

ABSTAIN 2,197,168.766 21.273

TOTAL 10,328,341.364 100.000

BROKER NON-VOTES 290,074.000

PROPOSAL 20
To make explicit the ability of Fidelity Emerging Markets Fund to
invest in securities or other instruments backed by physical
commodities and the ability to own physical commodities as the result
of ownership of other securities or instruments.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,349,897.697 68.643

AGAINST 2,559,392.329 8.633

ABSTAIN 6,736,642.385 22.724

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

PROPOSAL 21
To clarify that Fidelity Emerging Markets Fund can purchase an entire
issue of debt securities.
# OF % OF
SHARES VOTED SHARES VOTED
AFFIRMATIVE 20,634,566.947 69.603

AGAINST 2,242,717.180 7.565

ABSTAIN 6,768,648.284 22.832

TOTAL 29,645,932.411 100.000

BROKER NON-VOTES 975,793.000

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INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc.,
London, England
Fidelity Management & Research (Far East) Inc.,
Tokyo, Japan
Fidelity Investments Japan Ltd.
Fidelity International Investment Advisors
Fidelity International Investment Advisors
(U.K.) Limited
OFFICERS
Edward C. Johnson 3d, PRESIDENT
Robert C. Pozen, SENIOR VICE PRESIDENT
William J. Hayes, VICE PRESIDENT
Richard A. Spillane, Jr., VICE PRESIDENT
Allan Liu, VICE PRESIDENT, SOUTHEAST ASIA FUND
Shigeki Makino, VICE PRESIDENT, JAPAN FUND, PACIFIC BASIN FUND
Kevin McCarey, VICE PRESIDENT, EUROPE CAPITAL APPRECIATION FUND
Patricia Satterthwaite, VICE PRESIDENT, LATIN AMERICA FUND
Thomas Sweeney, VICE PRESIDENT, CANADA FUND
Sally Walden, VICE PRESIDENT, EUROPE FUND
Arthur S. Loring, SECRETARY
Richard A. Silver, TREASURER
Robert H. Morrison, MANAGER, SECURITY TRANSACTIONS
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER SERVICING AGENT
Fidelity Service Company, Inc.
Boston, MA
* INDEPENDENT TRUSTEES
CUSTODIANS
The Chase Manhattan Bank
New York, NY
EMERGING MARKETS FUND, EUROPE FUND, EUROPE CAPITAL APPRECIATION FUND,
JAPAN FUND, PACIFIC BASIN FUND, SOUTHEAST ASIA FUND
Brown Brothers Harriman & Co.
Boston, MA
CANADA FUND, FRANCE FUND, GERMANY FUND, HONG KONG AND CHINA FUND,
JAPAN SMALL COMPANIES FUND, LATIN AMERICA FUND, NORDIC FUND, UNITED
KINGDOM FUND
FIDELITY'S INTERNATIONAL EQUITY FUNDS
Canada Fund
Diversified International Fund
Emerging Markets Fund
Europe Fund
Europe Capital Appreciation Fund
France Fund
Germany Fund
Hong Kong and China Fund
International Growth and Income Fund
International Value Fund
Japan Fund
Japan Small Companies Fund
Latin America Fund
Nordic Fund
Overseas Fund
Pacific Basin Fund
Southeast Asia Fund
United Kingdom Fund
Worldwide Fund
CORPORATE HEADQUARTERS
82 Devonshire Street
Boston, MA 02109
1-800-544-8888
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
TouchTone Xpress 1-800-544-5555
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P.O. Box 193
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