MERRILL LYNCH
GLOBAL
RESOURCES
TRUST
FUND LOGO
Annual Report
July 31, 1997
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Trust unless
accompanied or preceded by the Trust's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
<PAGE>
Merrill Lynch
Global Resources Trust
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
MERRILL LYNCH GLOBAL RESOURCES TRUST
DEAR SHAREHOLDER
Fiscal Year in Review
The environment for investments in the natural resources sector was
generally positive for the year ended July 31, 1997. With the
exception of shares of gold mining companies, natural resource-
related stocks posted solid gains during the year. However, these
gains lagged the robust returns of the broad global stock market
averages. Investor sentiment for the natural resource sector was
boosted by a positive global economic environment. Both the US and
UK economies exhibited solid growth. While economic growth in the
rest of the industrialized world was less robust, investors remained
hopeful that monetary policy would support an acceleration of
economic activity in these markets. This environment of moderate
global economic growth and modest inflationary pressures encouraged
expectations of an extended economic cycle, which would be positive
for the demand outlook for many basic materials. This positive
sentiment moderated somewhat in March and April, as rising interest
rates in the United States led investors to question the
sustainability of economic growth rates, particularly in the United
States. The US Federal Reserve Board announced an increase in the
Federal Funds rate of 0.25% to 5.5% on March 25, 1997 in a
preemptive move to contain inflationary pressures. However, more
recently sentiment has improved as economic releases have shown
continued low inflation and moderate economic growth.
<PAGE>
Commodity prices were mixed during the year ended July 31, 1997.
Base metals prices, led by aluminum and zinc, posted strong gains as
inventory levels continued to be reduced on the major commodity
exchanges. There were also some price increases announced by
companies in the steel and paper products areas. After resisting
these proposed price increases during the fourth quarter of 1996 and
the first quarter of 1997, customers currently appear to be
accepting these increases.
Oil and natural gas prices were particularly volatile during the
year. After rising significantly in the fourth quarter of 1996, both
oil and natural gas prices fell sharply through the first quarter of
1997 as inventory levels rose, primarily in response to weak demand
resulting from warmer-than-normal temperatures across much of the
United States. Oil prices have since stabilized, but remain near
their recent lows as inventories have continued to build more
quickly than expected. Natural gas prices have recovered
significantly from their lows in March as inventory levels remain
near historical lows. Conversely, gold prices moved lower on
concerns about possible increases in the supply of gold to the
marketplace, particularly from sales by central banks.
For the year ended July 31, 1997, total returns for the Trust's
Class A, Class B, Class C and Class D Shares were +17.95%, +16.72%,
+16.77% and +17.66%, respectively. (Trust results shown do not
reflect sales charges, and would be lower if sales charges were
included. For complete performance information, including average
annual total returns, see pages 4--7 of this report to
shareholders.)
The Trust's large exposure to the energy sector enhanced performance
during the 12 months ended July 31, 1997. Share prices of energy-
related companies rose sharply during the second half of 1996,
benefiting from stronger-than-expected oil and natural gas prices.
Share prices of exploration and production companies and oil service
companies performed particularly well. Share prices retraced some of
these gains during the first quarter of 1997 as both oil and natural
gas prices fell sharply. However, share prices resumed their upward
trend during the second quarter of 1997, as oil prices and natural
gas prices stabilized and recovered from their first quarter
declines. Integrated oil companies performed particularly well as
their downstream and chemical operations tended to insulate them
from volatile energy prices. In addition, the Trust's holdings in
non-US energy companies showed particular strength during the year,
after having lagged the strong returns of US energy companies for
much of 1996. Our increased emphasis on refining and marketing
companies also contributed positively to performance, as these
companies benefited from an increase in margins in response to
strong gasoline demand and lower crude oil prices.
<PAGE>
Trust returns also benefited from our overweighted position in the
industrial side of our investment universe, including the paper and
forest products and the base metals sectors. Share prices of
companies in the paper and forest products group rose sharply in
anticipation of improving industry fundamentals. There were
increasing indications that we may have seen the trough in pulp and
paper pricing for this cycle. Inventory levels for many paper
products started to show significant declines, and shipment levels
began to increase noticeably during the second quarter of 1997. This
allowed paper companies to announce modest price increases for many
of their products. In addition, recent poor pricing is expected to
keep capacity additions limited for most paper grades over the next
few years. This is likely to allow industry fundamentals to improve
as operating rates move higher, thereby giving the industry greater
pricing flexibility in the future.
Share prices of base metals companies also posted solid gains as
supply/demand fundamentals in this area improved. Demand for most
base metals remained on an upward trend, which caused inventory
levels for most base metals to continue their declines on the major
commodity exchanges. These improved industry fundamentals led to
higher base metals prices, and resulted in earnings estimate
upgrades for many base metals companies.
The Trust's performance was hurt by our exposure to the gold sector
during the fiscal year. Gold shares fell as gold prices suffered
from continued low inflationary expectations and investor concerns
about possible increases in the supply of gold resulting from
potential sales by central banks and forward sales by gold
producers. After trending downward since early 1996, the price of
gold collapsed in early July when the Australian Reserve Bank
disclosed that it had sold two-thirds of its gold reserves. Prior to
this, investor concern was focused primarily on gold sales by
European central banks in preparation for the European Monetary
Union in 1999. The Australian sale appeared to signal to the
marketplace a real change in central bank attitudes toward gold,
which may keep downward pressure on gold prices in the near term.
Gold shares also suffered from the negative sentiment surrounding
the Canadian-based gold exploration company, Bre-X Minerals Ltd. The
shares of Bre-X Minerals Ltd. collapsed after due-diligence drilling
by Freeport-McMoRan Copper & Gold Inc., its partner in the Busang
gold project in Indonesia, found insignificant amounts of gold.
Subsequent testing on this property has shown that it would be
uneconomical to develop it. As a result, gold shares weakened
considerably as investors reduced the valuation levels they were
willing to put on the gold reserves of these companies. While we
believe that the supply/demand fundamentals in the gold market
remain tight, we do not expect gold prices to move substantially
higher in the near term. Investments in the gold sector remain
focused on low-cost producers with strong production and reserve
growth potentials.
<PAGE>
Investment Activities
During the July quarter, there were no significant geographic or
industry allocation changes made in the Trust. The Trust's primary
investment focus remained the energy sector, followed by significant
exposures to both the base metals and forest products sectors. We
used the strength in stock prices in the energy sector as an
opportunity to realize profits in some of our energy holdings which
were nearing our price targets. This included the elimination of our
holdings in Occidental Petroleum Corp., Repsol, S.A. and IHC Caland
N.V. We also believe there may be some modest downside risk to oil
prices in the near term as the market absorbs the resumption of oil
exports from Iraq to fund humanitarian aid. These exports had been
delayed in June and July pending revisions to the aid distribution
plan. We also eliminated our position in Newcrest Mining Ltd. after
continued operational problems at one of its gold projects in
Australia. In addition, we sold our position in Pacific Forest
Products Ltd. following a takeover offer from TimberWest Forest
Holdings. We increased our exposure to the paper group by initiating
a position in Champion International Corp., an asset-rich paper
company with significant corporate restructuring potential. We also
increased our exposure to the metals and mining area with the
purchase of North Ltd., an Australian-based mining conglomerate, and
Pechiney, a French-based aluminum company.
In Conclusion
We remain positive on the outlook for investments in the natural
resources sector, even in the current low inflation environment. We
continue to focus investments on the industrial side of our
investment universe, which we believe will benefit from our
expectations of continued moderate global economic growth. While we
may not experience sharp commodity price spikes under this economic
scenario, we expect the companies to benefit from strong demand and
increased volumes and shipments of their products. In fact, recent
earnings results in the paper, base metals and energy areas have
generally been higher than expected, despite soft commodity prices.
This has been primarily in response to strong volumes and continued
rationalization of their businesses. We expect these trends of
strong demand and increased focus on cost-cutting to continue, which
could provide attractive opportunities for investment in the natural
resource sector even without sharply higher commodity prices.
We thank you for your investment in Merrill Lynch Global Resources
Trust, and we look forward to reviewing our outlook and strategy
with you again in our upcoming quarterly report to shareholders.
Sincerely,
<PAGE>
(Arthur Zeikel)
Arthur Zeikel
President
(Peter A. Lehman)
Peter A. Lehman
Vice President and Portfolio Manager
September 5, 1997
PERFORMANCE DATA
About Fund Performance
Investors are able to purchase shares of the Trust through the
Merrill Lynch Select Pricing SM System, which offers four pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end
load) of 5.25% and bear no ongoing distribution or account
maintenance fees. Class A Shares are available only to eligible
investors.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.75% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after approximately 8 years. (There is no initial
sales charge for automatic share conversions.)
<PAGE>
* Class C Shares are subject to a distribution fee of 0.75% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 5.25% and
an account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation
of future performance. Figures shown in the "Average Annual Total
Return" tables as well as the total returns and cumulative total
returns in the "Performance Summary" tables assume reinvestment of
all dividends and capital gains distributions at net asset value on
the ex-dividend date. Investment return and principal value of
shares will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Dividends paid to each class
of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
Average Annual Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 6/30/97 +10.38% +4.58%
Five Years Ended 6/30/97 + 8.63 +7.47
Inception (10/24/88)
through 6/30/97 + 7.99 +7.32
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 6/30/97 +9.23% +5.23%
Five Years Ended 6/30/97 +7.51 +7.51
Ten Years Ended 6/30/97 +3.95 +3.95
<PAGE>
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
% Return % Return
Without CDSC With CDSC**
Class C Shares*
Year Ended 6/30/97 +9.18% +8.18%
Inception (10/21/94)
through 6/30/97 +7.59 +7.59
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Year Ended 6/30/97 +10.13% +4.35%
Inception (10/21/94)
through 6/30/97 + 8.51 +6.36
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
PERFORMANCE DATA (continued)
Total Return Based on a $10,000 Investment--Class A Shares and Class
B Shares
A line graph depicting the growth of an investment in the Fund's
Class A Shares compared to growth of an investment in the S&P 500
Index, Lipper Gold Funds Group Average and Lipper Natural Resources
Funds Group Average. Beginning and ending values are:
<PAGE>
10/24/88** 7/97
ML Global Resources Trust++--
Class A Shares* $ 9,475 $19,057
S&P 500 Index++++ $10,000 $43,516
Lipper Gold Funds
Group Average++++++ $10,000 $10,815
Lipper Natural Resources Fund
Group Average++++++++ $10,000 $25,052
A line graph depicting the growth of an investment in the Fund's
Class B Shares compared to growth of an investment in the S&P 500
Index, Lipper Gold Funds Group Average and Lipper Natural Resources
Funds Group Average. Beginning and ending values are:
7/87 7/97
ML Global Resources Trust++--
Class B Shares* $10,000 $13,501
S&P 500 Index++++ $10,000 $40,351
Lipper Gold Funds
Group Average++++++ $10,000 $ 7,170
Lipper Natural Resources Funds
Group Average++++++++ $10,000 $19,472
Total Return Based on a $10,000 Investment--Class C Shares and Class
D Shares
A line graph depicting the growth of an investment in the Fund's
Class C Shares and Class D Shares compared to growth of an
investment in the S&P 500 Index, Lipper Gold Funds Group Average and
Lipper Natural Resources Funds Group Average. Beginning and ending
values are:
10/21/94** 7/97
<PAGE>
ML Global Resources Trust++--
Class C Shares* $10,000 $12,564
ML Global Resources Trust++--
Class D Shares* $ 9,475 $12,173
S&P 500 Index++++ $10,000 $21,867
Lipper Gold Funds
Group Average++++++ $10,000 $ 7,918
Lipper Natural Resources Funds
Group Average++++++++ $10,000 $15,522
[FN]
*Assuming maximum sales charge, transaction costs and other
operating expenses, including advisory fees.
**Commencement of Operations.
++The Trust invests primarily in equity securities of domestic and
foreign companies with substantial natural resource assets.
++++This unmanaged broad-based Index is comprised of common stocks.
++++++The Lipper Gold Funds Group Average is an index of all US
mutual funds classified as gold-related funds.
++++++++The Lipper Natural Resources Funds Group Average is an index
of all US mutual funds classified as natural resource-related funds.
Past performance is not predictive of future performance.
PERFORMANCE DATA (continued)
<TABLE>
Performance Summary--Class A Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<S> <C> <C> <C> <C> <C>
10/24/88--12/31/88 $12.50 $12.00 $0.049 $0.139 - 2.48%
1989 12.00 14.89 -- 0.378 +27.39
1990 14.89 14.36 0.039 0.415 - 0.68
1991 14.36 13.94 0.786 0.471 + 5.91
1992 13.94 12.89 -- 0.238 - 5.87
1993 12.89 15.19 -- 0.138 +19.01
1994 15.19 15.14 -- 0.242 + 1.20
1995 15.14 16.51 -- 0.149 +10.03
1996 16.51 18.53 0.189 0.230 +14.88
1/1/97--7/31/97 18.53 19.90 -- -- + 7.39
------ ------
Total $1.063 Total $2.400
<PAGE>
Cumulative total return as of 7/31/97: +101.13%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures do not include sales charge; results would be lower if
sales charge was included.
</TABLE>
<TABLE>
Performance Summary--Class B Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<S> <C> <C> <C> <C> <C>
8/2/85--12/31/85 $10.00 $ 9.99 -- -- - 0.10%
1986 9.99 12.75 $0.280 $0.110 +32.37
1987 12.75 13.61 1.978 0.181 +21.22
1988 13.61 12.00 0.340 0.206 - 7.86
1989 12.00 14.89 -- 0.230 +26.09
1990 14.89 14.37 0.039 0.245 - 1.70
1991 14.37 13.96 0.786 0.305 + 4.79
1992 13.96 12.92 -- 0.090 - 6.82
1993 12.92 15.17 -- 0.049 +17.83
1994 15.17 15.16 -- 0.035 + 0.15
1995 15.16 16.51 -- 0.002 + 8.92
1996 16.51 18.55 0.189 0.018 +13.65
1/1/97--7/31/97 18.55 19.80 -- -- + 6.74
------ ------
Total $3.612 Total $1.471
Cumulative total return as of 7/31/97: +178.70%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures do not reflect deduction of any sales charge; results
would be lower if sales charge was deducted.
</TABLE>
PERFORMANCE DATA (concluded)
<TABLE>
Performance Summary--Class C Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<S> <C> <C> <C> <C> <C>
10/21/94--12/31/94 $15.93 $15.10 -- $0.052 - 4.88%
1995 15.10 16.44 -- -- + 8.87
1996 16.44 18.39 $0.189 0.086 +13.60
1/1/97--7/31/97 18.39 19.64 -- -- + 6.80
------ ------
Total $0.189 Total $0.138
<PAGE>
Cumulative total return as of 7/31/97: +25.64%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures do not reflect deduction of any sales charge; results
would be lower if sales charge was deducted.
</TABLE>
<TABLE>
Performance Summary--Class D Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<S> <C> <C> <C> <C> <C>
10/21/94--12/31/94 $15.96 $15.14 -- $0.068 - 4.71%
1995 15.14 16.49 -- 0.131 + 9.78
1996 16.49 18.50 $0.189 0.186 +14.56
1/1/97--7/31/97 18.50 19.83 -- -- + 7.19
------ ------
Total $0.189 Total $0.385
Cumulative total return as of 7/31/97: +28.46%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures do not include sales charge; results would be lower if
sales charge was included.
</TABLE>
<TABLE>
Recent Performance Results*
<CAPTION>
12 Month 3 Month
7/31/97 4/30/96 7/31/96 % Change % Change
<S> <C> <C> <C> <C> <C>
ML Global Resources Trust Class A Shares $19.90 $18.18 $17.27 +16.44%(1) +9.46%
ML Global Resources Trust Class B Shares 19.80 18.14 17.16 +16.60(1) +9.15
ML Global Resources Trust Class C Shares 19.64 17.98 17.08 +16.21(1) +9.23
ML Global Resources Trust Class D Shares 19.83 18.14 17.21 +16.44(1) +9.32
ML Global Resources Trust Class A Shares--Total Return +17.95(2) +9.46
ML Global Resources Trust Class B Shares--Total Return +16.72(3) +9.15
ML Global Resources Trust Class C Shares--Total Return +16.77(4) +9.23
ML Global Resources Trust Class D Shares--Total Return +17.66(5) +9.32
<PAGE>
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included.
(1)Percent change includes reinvestment of $0.189 per share capital
gains distributions.
(2)Percent change includes reinvestment of $0.230 per share ordinary
income dividends and $0.189 per share capital gains distributions.
(3)Percent change includes reinvestment of $0.018 per share ordinary
income dividends and $0.189 per share capital gains distributions.
(4)Percent change includes reinvestment of $0.086 per share ordinary
income dividends and $0.189 per share capital gains distributions.
(5)Percent change includes reinvestment of $0.186 per share ordinary
income dividends and $0.189 per share capital gains distributions.
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
Aluminum 56,000 Alcan Aluminium, Ltd. $ 1,456,254 $ 2,194,500 1.1%
57,000 ++Alumax, Inc. 1,964,466 2,415,375 1.2
17,000 Aluminum Company of America 891,028 1,504,500 0.7
------------ ------------ ------
4,311,748 6,114,375 3.0
Chemicals 16,000 Air Products and Chemicals, Inc. 720,944 1,411,000 0.7
26,400 BASF AG 633,146 1,015,938 0.5
12,000 Dow Chemical Co. (The) 826,912 1,140,000 0.6
40,200 duPont (E.I.) de Nemours & Co. 1,345,525 2,690,888 1.3
------------ ------------ ------
3,526,527 6,257,826 3.1
Diamonds 80,000 ++Aber Resources Ltd. 1,310,472 1,172,299 0.6
130,000 ++SouthernEra Resources Ltd. 806,522 940,734 0.4
------------ ------------ ------
2,116,994 2,113,033 1.0
Diversified Companies 102,000 Asahi Glass Co., Ltd. 1,223,974 921,013 0.4
27,000 Ashland Oil Inc. 1,144,672 1,434,375 0.7
26,500 Coastal Corp. 674,667 1,440,938 0.7
75,000 Cyprus Amax Minerals Co. 1,838,375 1,903,125 0.9
34,000 Freeport-McMoRan Copper & Gold,
Inc. (Class B) 1,171,540 994,500 0.5
46,300 Norcen Energy Resources Ltd. 596,432 1,105,652 0.5
378,000 North Ltd. 1,419,525 1,378,963 0.7
273,000 RGC Ltd. 1,101,113 843,481 0.4
------------ ------------ ------
9,170,298 10,022,047 4.8
<PAGE>
Gold 824,000 ++Acacia Resources Ltd. 1,552,817 889,529 0.4
188,600 ++Amax Gold, Inc. 1,114,318 1,249,475 0.6
94,500 Ashanti Goldfields Co. Ltd. (GDR)** 2,346,106 1,067,850 0.5
122,500 Cambior Inc. 1,625,848 1,400,608 0.7
122,000 ++Casmyn Corp. 1,122,818 823,500 0.4
903,900 Delta Gold N.L. 1,698,537 1,204,587 0.6
163,200 Driefontein Consolidated Ltd. 2,534,252 1,173,808 0.6
84,600 ++Getchell Gold Corp. 3,502,988 2,823,525 1.4
825,000 Great Central Mines N.L. 2,473,842 1,689,084 0.8
373,800 ++Miramar Mining Corp. 1,900,432 1,447,160 0.7
115,622 Newmont Mining Corp. 4,426,537 4,769,407 2.3
750,000 ++Normandy Mining Ltd. 848,403 865,481 0.4
215,000 Placer Dome Inc. 4,687,040 3,655,000 1.8
131,500 Prime Resources Group, Inc. 1,286,428 1,084,811 0.5
1,097,000 Resolute Ltd. 2,284,526 1,510,926 0.7
122,000 ++Sutton Resources Ltd. 1,097,905 971,127 0.5
158,000 ++TVX Gold Inc. 1,272,815 720,875 0.4
233,331 ++William Resources Inc. 703,747 273,534 0.1
------------ ------------ ------
36,479,359 27,620,287 13.4
Integrated Oil 39,000 Amerada Hess Corp. 2,102,507 2,293,687 1.1
Companies--Domestic 20,000 Amoco Corp. 1,118,700 1,880,000 0.9
------------ ------------ ------
3,221,207 4,173,687 2.0
Integrated Oil 384,000 British Petroleum Co., PLC 1,554,500 5,239,388 2.5
Companies-- 61,300 Ente Nazionale Idrocarburi S.p.A
International (ENI) (ADR)* 2,865,775 3,605,206 1.7
8,800 OMV AG 933,582 1,219,101 0.6
149,800 Petro-Canada 1,635,043 2,668,312 1.3
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
Integrated Oil 46,100 Societe Nationale Elf Aquitaine (ADR)* $ 1,691,817 $ 2,639,225 1.3%
Companies-- 40,000 Total, S.A. (Class B) 2,462,120 4,017,958 2.0
International 52,000 Yacimientos Petroliferos Fiscales S.A.
(concluded) (YPF) (ADR)* 1,274,780 1,683,500 0.8
------------ ------------ ------
12,417,617 21,072,690 10.2
<PAGE>
Metals & Mining 31,100 ASARCO Inc. 923,026 1,057,400 0.5
1,558,000 ++Centaur Mining & Exploration Ltd. 2,347,920 1,937,085 0.9
96,100 ++Falconbridge Ltd. 2,129,792 2,058,441 1.0
38,800 Inco Ltd. 1,284,094 1,200,375 0.6
316,800 Industrias Penoles, S.A. de C.V. 1,391,890 1,416,997 0.7
2,470,000 M.I.M. Holdings Ltd. 5,396,407 3,420,382 1.7
184,159 Minsur S.A. 597,621 609,931 0.3
391,000 Mitsubishi Materials Corp. 1,955,466 1,352,827 0.7
99,400 Noranda Inc. 1,869,535 2,136,320 1.0
108,000 Outokumpu OY 1,976,734 2,052,932 1.0
53,100 P.T. Tambang Timah (GDR)** (b) 661,263 672,246 0.3
679,500 Pasminco Ltd. 918,917 1,305,190 0.6
32,000 Pechiney (A Shares) 1,255,340 1,389,619 0.7
18,300 Phelps Dodge Corp. 1,067,369 1,556,644 0.8
615,000 QNI Ltd. 1,235,188 1,144,669 0.6
32,000 Rio Algom Ltd. 619,108 798,900 0.4
201,100 Rio Tinto PLC (The) 2,631,660 3,266,966 1.6
1,717,000 Savage Resources Ltd. 1,306,929 1,521,185 0.7
222,000 Savage Resources Ltd. (Warrants) (a) 29,591 39,667 0.0
220,000 Sumitomo Metal Mining Co. Ltd. 1,830,947 1,268,017 0.6
91,000 Trelleborg 'B' Fria 1,234,283 1,485,752 0.7
643,400 WMC Ltd. 3,807,237 3,729,582 1.8
233,000 Westmin Resources, Inc. 1,221,705 1,129,677 0.6
------------ ------------ ------
37,692,022 36,550,804 17.8
Oil & Gas Producers 92,000 Apache Corp. 2,453,418 3,243,000 1.6
76,000 ++Benton Oil & Gas Co. 1,159,000 1,154,250 0.6
260,000 ++Chauvco Resources, Ltd. 3,011,394 4,063,970 2.0
53,500 ++Chieftain International Inc. 1,193,792 1,153,594 0.5
183,200 ++Enserch Exploration Inc. 1,779,675 1,832,000 0.9
205,400 Enterprise Oil PLC 1,384,374 2,323,678 1.1
388,400 ++Gulf Canada Resources Ltd. 2,908,508 3,010,100 1.5
30,300 Louisiana Land and Exploration Co.
(The) 1,250,249 2,139,937 1.0
111,600 Mitchell Energy & Development Corp.
(Class B) 2,267,579 2,636,550 1.3
124,500 ++Northrock Resources Ltd. 1,001,587 1,779,344 0.9
95,000 ++Oryx Energy Co. 1,588,361 2,345,312 1.1
41,000 Pancanadian Petroleum Ltd. 777,815 804,038 0.4
301,000 Ranger Oil Ltd. 1,992,730 2,953,562 1.4
50,100 Sonat Inc. 1,803,548 2,498,737 1.2
------------ ------------ ------
24,572,030 31,938,072 15.5
<PAGE>
Oil Services 57,200 Coflexip Stena Offshore, Inc. (ADR)* 1,212,458 1,944,800 0.9
39,600 ++Petroleum Geo-Services ASA (ADR)* 1,157,072 2,155,725 1.1
25,000 Schlumberger Ltd. Inc. 715,668 1,909,375 0.9
44,400 Smedvig ASA (ADR)* 943,500 1,265,400 0.6
29,500 Transocean Offshore Drilling Inc. 1,821,013 2,409,781 1.2
------------ ------------ ------
5,849,711 9,685,081 4.7
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded)
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
Paper & Pulp 61,066 Aracruz Celulose S.A. (ADR)* $ 489,264 $ 1,267,119 0.6%
181,200 Avenor Inc. 3,464,699 3,782,922 1.8
29,000 Champion International Corp. 1,491,695 1,798,000 0.9
85,000 Empresa Nacional de Celulosas S.A.
(ENCE) 1,253,909 1,581,485 0.8
20,900 Georgia-Pacific Corp. 1,299,455 1,973,744 1.0
31,400 International Paper Co. 1,181,730 1,758,400 0.9
25,000 James River Corp. 760,598 1,029,687 0.5
270,000 Metsa Serla OY 'B' 2,295,824 2,368,767 1.1
53,500 Mo Och Domsjo AB Co. 1,287,297 1,881,366 0.9
261,496 Slocan Forest Products Ltd. 2,342,662 2,459,981 1.2
63,500 Stone Container Corp. 785,423 1,055,687 0.5
53,000 Weyerhaeuser Co. 2,242,950 3,299,250 1.6
29,000 Willamette Industries, Inc. 1,089,935 2,209,437 1.1
------------ ------------ ------
19,985,441 26,465,845 12.9
Petroleum Refining 83,000 Sun Company, Inc. 2,213,707 2,972,437 1.4
250,000 Total Petroleum (North America), Ltd. 3,028,198 2,625,000 1.3
------------ ------------ ------
5,241,905 5,597,437 2.7
Plantations 717,000 Golden Hope Plantations BHD 1,325,786 1,137,188 0.5
578,000 Kuala Lumpur Kepong BHD 790,865 1,370,708 0.7
------------ ------------ ------
2,116,651 2,507,896 1.2
Steel 472,000 British Steel PLC 1,240,738 1,277,978 0.6
37,000 Koninklijke Nederlandsche Hoogovens
en Staalfabrienken N.V. 1,622,450 2,246,275 1.1
671,000 Nippon Steel Corp. 2,290,933 1,879,932 0.9
1,042,000 Sumitomo Metal Industries, Ltd. 3,344,833 2,620,388 1.3
------------ ------------ ------
8,498,954 8,024,573 3.9
<PAGE>
Wood Products 92,500 Louisiana-Pacific Corp. 2,943,595 2,121,719 1.0
146,100 Riverside Forest Products Ltd. 2,401,223 1,607,005 0.8
------------ ------------ ------
5,344,818 3,728,724 1.8
Total Common Stocks 180,545,282 201,872,377 98.0
Face Amount Short-Term Securities
Repurchase $1,767,000 UBS Securities, purchased on
Agreements*** 7/31/1997 to yield 5.75% to 8/01/1997 1,767,000 1,767,000 0.9
Total Short-Term Securities 1,767,000 1,767,000 0.9
Total Investments $182,312,282 203,639,377 98.9
============
Other Assets Less Liabilities 2,333,349 1.1
------------ ------
Net Assets $205,972,726 100.0%
============ ======
<FN>
*American Depositary Receipts (ADR).
**Global Depositary Receipts (GDR).
***Repurchase Agreements are fully collateralized by US Government &
Agency Obligations.
(a)Warrants entitle the Trust to purchase a predetermined number of
shares of common stock. The purchase price and number of shares are
subject to adjustment under certain conditions until the expiration
date.
(b)The security may be offered and sold to "qualified institutional
buyers" under Rule 144A of the Securities Act of 1933.
++Non-income producing security.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION
<TABLE>
Statement of Assets and Liabilities as of July 31, 1997
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$182,312,282) (Note 1a) $ 203,639,377
Cash 220,599
Receivables:
Securities sold $ 3,453,226
Dividends 343,372
Beneficial interest sold 233,722 4,030,320
--------------
Prepaid registration fees and other assets (Note 1f) 32,836
--------------
Total assets 207,923,132
--------------
<PAGE>
Liabilities: Payables:
Beneficial interest redeemed 918,382
Securities purchased 619,879
Investment adviser (Note 2) 103,879
Distributor (Note 2) 90,093 1,732,233
--------------
Accrued expenses and other liabilities 218,173
--------------
Total liabilities 1,950,406
--------------
Net Assets: Net assets $ 205,972,726
==============
Net Assets Class A Shares of beneficial interest, $0.10 par value,
Consist of: unlimited number of shares authorized $ 93,003
Class B Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 390,867
Class C Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 13,651
Class D Shares of beneficial interest, $0.10 par value,
unlimited number of shares authorized 541,535
Paid-in capital in excess of par 166,744,770
Undistributed investment income--net 319,397
Undistributed realized capital gains on investments and
foreign currency transactions--net 16,549,923
Unrealized appreciation on investments and foreign currency
transactions--net 21,319,580
--------------
Net assets $ 205,972,726
==============
Net Asset Value: Class A--Based on net assets of $18,503,979 and 930,025
shares of beneficial interest outstanding $ 19.90
==============
Class B--Based on net assets of $77,385,748 and 3,908,673
shares of beneficial interest outstanding $ 19.80
==============
Class C--Based on net assets of $2,680,489 and 136,507
shares of beneficial interest outstanding $ 19.64
==============
Class D--Based on net assets of $107,402,510 and 5,415,347
shares of beneficial interest outstanding $ 19.83
==============
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statement of Operations for the Year Ended July 31, 1997
<S> <S> <C> <C>
Investment Dividends (net of $265,237 foreign withholding tax) $ 3,711,085
Income Interest and discount earned 237,920
(Notes 1d & 1e): Other income 19,039
--------------
Total income 3,968,044
--------------
Expenses: Investment advisory fees (Note 2) $ 1,350,592
Account maintenance and distribution fees--Class B (Note 2) 889,611
Account maintenance fees--Class D (Note 2) 276,330
Transfer agent fees--Class D (Note 2) 206,961
Transfer agent fees--Class B (Note 2) 199,253
Custodian fees 128,670
Printing and shareholder reports 88,685
Registration fees (Note 1f) 79,450
Accounting services (Note 2) 76,212
Professional fees 58,834
Transfer agent fees--Class A (Note 2) 42,021
Trustees' fees and expenses 41,233
Account maintenance and distribution fees--Class C (Note 2) 33,693
Pricing fees 13,919
Transfer agent fees--Class C (Note 2) 8,170
Other 8,692
--------------
Total expenses 3,502,326
--------------
Investment income--net 465,718
--------------
Realized & Realized gain (loss) from:
Unrealized Gain Investments--net 21,366,629
(Loss) on Foreign currency transactions--net (74,646) 21,291,983
Investments & --------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net 13,768,880
(Notes 1b, 1c, Foreign currency transactions--net (10,050) 13,758,830
1e & 3): -------------- --------------
Net realized and unrealized gain on investments and foreign
currency transactions 35,050,813
--------------
Net Increase in Net Assets Resulting from Operations $ 35,516,531
==============
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION (continued)
<TABLE>
Statements of Changes in Net Assets
<CAPTION>
For the Year Ended July 31,
Increase (Decrease) in Net Assets: 1997 1996
<S> <S> <C> <C>
Operations: Investment income--net $ 465,718 $ 1,649,490
Realized gain on investments and foreign currency transactions
--net 21,291,983 14,984,789
Change in unrealized appreciation/depreciation on investments
and foreign currency transactions--net 13,758,830 (8,334,916)
-------------- --------------
Net increase in net assets resulting from operations 35,516,531 8,299,363
-------------- --------------
Dividends & Investment income--net:
Distributions to Class A (303,399) (238,068)
Shareholders Class B (98,601) (15,913)
(Note 1g): Class C (17,412) --
Class D (1,171,993) (869,875)
Realized gain on investments--net:
Class A (245,005) --
Class B (956,214) --
Class C (40,585) --
Class D (1,157,650) --
-------------- --------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (3,990,859) (1,123,856)
-------------- --------------
Beneficial Interest Net decrease in net assets derived from beneficial
Transactions interest transactions (54,789,794) (58,734,873)
(Note 4): -------------- --------------
Net Assets: Total decrease in net assets (23,264,122) (51,559,366)
Beginning of year 229,236,848 280,796,214
-------------- --------------
End of year* $ 205,972,726 $ 229,236,848
============== ==============
<FN>
*Undistributed investment income--net (Note 1h) $ 319,397 $ 1,625,242
============== ==============
See Notes to Financial Statements.
</TABLE>
<PAGE>
FINANCIAL INFORMATION (continued)
<TABLE>
Financial Highlights
<CAPTION>
The following per share data and ratios have been derived Class A
from information provided in the financial statements.
For the Year Ended July 31,
Increase (Decrease) in Net Asset Value: 1997++ 1996++ 1995 1994 1993
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year $ 17.27 $ 16.70 $ 15.84 $ 14.07 $ 14.33
Operating ---------- ---------- ---------- ---------- ----------
Performance: Investment income--net .14 .22 .22 .22 .24
Realized and unrealized gain (loss)
on investments and foreign currency
transactions--net 2.91 .50 .88 1.69 (.26)
---------- ---------- ---------- ---------- ----------
Total from investment operations 3.05 .72 1.10 1.91 (.02)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net (.23) (.15) (.24) (.14) (.24)
Realized gain on investments--net (.19) -- -- -- --
---------- ---------- ---------- ---------- ----------
Total dividends and distributions (.42) (.15) (.24) (.14) (.24)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 19.90 $ 17.27 $ 16.70 $ 15.84 $ 14.07
========== ========== ========== ========== ==========
Total Investment Based on net asset value per share 17.95% 4.34% 7.05% 13.69% (.05%)
Return:* ========== ========== ========== ========== ==========
Ratios to Average Expenses 1.01% 1.03% 1.06% .92% .95%
Net Assets: ========== ========== ========== ========== ==========
Investment income--net .76% 1.26% 1.34% 1.39% 1.62%
========== ========== ========== ========== ==========
Supplemental Net assets, end of year
Data: (in thousands) $ 18,504 $ 22,726 $ 28,729 $ 20,054 $ 12,087
========== ========== ========== ========== ==========
Portfolio turnover 24.23% 26.48% 31.64% 54.87% 66.78%
========== ========== ========== ========== ==========
Average commission rate paid++++ $ .0217 $ .0223 -- -- --
========== ========== ========== ========== ==========
<PAGE>
<FN>
*Total investment returns exclude the effects of sales loads.
++Based on average shares outstanding during the year.
++++For fiscal years beginning on or after September 1, 1995,
the Trust is required to disclose its average commission
rate per share for purchases and sales of equity securities.
The "Average Commission Rate Paid" includes commissions paid
in foreign currencies, which have been converted into US
dollars using the prevailing exchange rate on the date of
the transaction. Such conversions may significantly affect
the rate shown.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (continued)
<TABLE>
Financial Highlights (continued)
<CAPTION>
The following per share data and ratios have been derived Class B
from information provided in the financial statements.
For the Year Ended July 31,
Increase (Decrease) in Net Asset Value: 1997++++ 1996++++ 1995 1994 1993
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year $ 17.16 $ 16.62 $ 15.72 $ 14.02 $ 14.26
Operating ---------- ---------- ---------- ---------- ----------
Performance: Investment income (loss)--net (.05) .03 .10 .05 .09
Realized and unrealized gain (loss)
on investments and foreign currency
transactions--net 2.90 .51 .84 1.70 (.24)
---------- ---------- ---------- ---------- ----------
Total from investment operations 2.85 .54 .94 1.75 (.15)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions:
Investment income--net (.02) --++ (.04) (.05) (.09)
Realized gain on investments--net (.19) -- -- -- --
---------- ---------- ---------- ---------- ----------
Total dividends and distributions (.21) -- (.04) (.05) (.09)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 19.80 $ 17.16 $ 16.62 $ 15.72 $ 14.02
========== ========== ========== ========== ==========
Total Investment Based on net asset value per share 16.72% 3.26% 5.95% 12.52% (1.02%)
Return:* ========== ========== ========== ========== ==========
Ratios to Average Expenses 2.04% 2.07% 2.08% 1.95% 1.99%
Net Assets: ========== ========== ========== ========== ==========
Investment income (loss)--net (.29%) .20% .31% .35% .60%
========== ========== ========== ========== ==========
<PAGE>
Supplemental Net assets, end of year
Data: (in thousands) $ 77,386 $ 94,199 $ 141,800 $ 236,581 $ 208,113
========== ========== ========== ========== ==========
Portfolio turnover 24.23% 26.48% 31.64% 54.87% 66.78%
========== ========== ========== ========== ==========
Average commission rate paid++++++ $ .0217 $ .0223 -- -- --
========== ========== ========== ========== ==========
<FN>
*Total investment returns exclude the effects of sales loads.
++Amount is less than $.01 per share.
++++Based on average shares outstanding during the year.
++++++For fiscal years beginning on or after September 1, 1995,
the Trust is required to disclose its average commission
rate per share for purchases and sales of equity securities.
The "Average Commission Rate Paid" includes commissions paid
in foreign currencies, which have been converted into US
dollars using the prevailing exchange rate on the date of
the transaction. Such conversions may significantly affect
the rate shown.
See Notes to Financial Statements.
</TABLE>
FINANCIAL INFORMATION (concluded)
<TABLE>
Financial Highlights (concluded)
<CAPTION>
Class C Class D
For the For the
The following per share data and ratios have Period Period
been derived from information provided in the Oct. 21, Oct. 21,
financial statements. For the Year 1994++ to For the Year 1994++ to
Ended July 31, July 31, Ended July 31, July 31,
Increase (Decrease) in Net Asset Value: 1997++++ 1996++++ 1995 1997++++ 1996++++ 1995
<S> <S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning
Operating of period $ 17.08 $ 16.55 $ 15.93 $ 17.21 $ 16.67 $ 15.96
Performance: -------- -------- -------- -------- -------- --------
Investment income (loss)
--net (.06) .04 .05 .09 .17 .12
Realized and unrealized
gain on investments and
foreign currency
transactions--net 2.90 .49 .62 2.91 .50 .66
-------- -------- -------- -------- -------- --------
Total from investment
operations 2.84 .53 .67 3.00 .67 .78
-------- -------- -------- -------- -------- --------
Less dividends and
distributions:
Investment income--net (.09) -- (.05) (.19) (.13) (.07)
Realized gain on
investments--net (.19) -- -- (.19) -- --
-------- -------- -------- -------- -------- --------
Total dividends and
distributions (.28) -- (.05) (.38) (.13) (.07)
-------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 19.64 $ 17.08 $ 16.55 $ 19.83 $ 17.21 $ 16.67
======== ======== ======== ======== ======== ========
<PAGE>
Total Investment Based on net asset value
Return:** per share 16.77% 3.20% 4.26%+++ 17.66% 4.06% 4.93%+++
======== ======== ======== ======== ======== ========
Ratios to Average Expenses 2.06% 2.07% 2.20%* 1.26% 1.27% 1.39%*
Net Assets: ======== ======== ======== ======== ======== ========
Investment income (loss)
--net (.33%) .27% .28%* .51% 1.00% 1.02%*
======== ======== ======== ======== ======== ========
Supplemental Net assets, end of period
Data: (in thousands) $ 2,680 $ 3,388 $ 2,800 $107,403 $108,924 $107,467
======== ======== ======== ======== ======== ========
Portfolio turnover 24.23% 26.48% 31.64% 24.23% 26.48% 31.64%
======== ======== ======== ======== ======== ========
Average commission rate
paid++++++ $ .0217 $ .0223 -- $ .0217 $ .0223 --
======== ======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
++Commencement of Operations.
++++Based on average shares outstanding during the year.
++++++For fiscal years beginning on or after September 1, 1995,
the Trust is required to disclose its average commission
rate per share for purchases and sales of equity securities.
The "Average Commission Rate Paid" includes commissions paid
in foreign currencies, which have been converted into US
dollars using the prevailing exchange rate on the date of
the transaction. Such conversions may significantly affect
the rate shown.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
<PAGE>
1. Significant Accounting Policies:
Merrill Lynch Global Resources Trust (the "Trust") is registered
under the Investment Company Act of 1940 as a non-diversified, open-
end management investment company. The Trust offers four classes of
shares under the Merrill Lynch Select Pricing SM System. Shares of
Class A and Class D are sold with a front-end sales charge. Shares
of Class B and Class C may be subject to a contingent deferred sales
charge. All classes of shares have identical voting, dividend,
liquidation and other rights and the same terms and conditions,
except that Class B, Class C and Class D Shares bear certain
expenses related to the account maintenance of such shares, and
Class B and Class C Shares also bear certain expenses related to the
distribution of such shares. Each class has exclusive voting rights
with respect to matters relating to its account maintenance and
distribution expenditures. The following is a summary of significant
accounting policies followed by the Trust.
(a) Valuation of investments--Portfolio securities which are traded
on stock exchanges are valued at the last sale price on the exchange
on which such securities are traded, as of the close of business on
the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange
designated by or under the authority of the Trustees of the Trust as
the primary market. Securities which are traded both in the over-the-
counter market and on a stock exchange are valued according to the
broadest and most representative market. Options written are valued
at the last sale price in the case of exchange-traded options or, in
the case of options traded in the over-the-counter market, the last
asked price. Options purchased are valued at the last sale price in
the case of exchange-traded options or, in the case of options
traded in the over-the-counter market, the last bid price. Short-
term securities are valued at amortized cost, which approximates
market value. Other investments are stated at market value.
Securities and other assets for which market value quotations are
not available are valued at their fair value as determined in good
faith by or under the direction of the Trustees of the Trust.
(b) Derivative financial instruments--The Trust may engage in
various portfolio strategies to seek to increase its return by
hedging its portfolio against adverse movements in the equity, debt
and currency markets. Losses may arise due to changes in the value
of the contract or if the counterparty does not perform under the
contract.
<PAGE>
* Forward foreign exchange contracts--The Trust is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Trust's records. However, the effect on net
investment income is recorded from the date the Trust enters into
such contracts. Premium or discount is amortized over the life of
the contracts.
* Options--The Trust can write covered call options and purchase put
options. When the Trust writes an option, an amount equal to the
premium received by the Trust is reflected as an asset and an
equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current market value of the option
written. When a security is purchased or sold through an exercise of
an option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Trust enters into a closing transaction), the Trust
realizes a gain or loss on the option to the extent of the premiums
received or paid (or loss or gain to the extent the cost of the
closing transaction is less than or greater than the premiums paid
or received).
Written and purchased options are non-income producing investments.
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(d) Income taxes--It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required. Under the applicable foreign tax law, a
withholding tax may be imposed on interest, dividends, and capital
gains at various rates.
NOTES TO FINANCIAL STATEMENTS (continued)
<PAGE>
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Dividend income is recorded on the ex-
dividend dates. Dividends from foreign securities where the ex-
dividend date may have passed are subsequently recorded when the
Trust has determined the ex-dividend date. Interest income is
recognized on the accrual basis. Realized gains and losses on
security transactions are determined on the identified cost basis.
(f) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(g) Dividends and distributions--Dividends and distributions paid by
the Trust are recorded on the ex-dividend dates.
(h) Reclassification--Generally accepted accounting principles
require that certain components of net assets be reclassified to
reflect permanent differences between financial and tax reporting.
Accordingly, current year's permanent book/tax differences of
$180,158 have been reclassified between undistributed net investment
income and undistributed net realized capital gains. These
reclassifications have no effect on net assets or net asset values
per share.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Trust has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect wholly-
owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is
the limited partner. The Trust has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor, Inc. ("MLFD" or "Distributor"), a wholly-owned
subsidiary of Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Trust's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Trust. For such
services, the Trust pays a monthly fee of 0.60%, on an annual basis,
of the average daily value of the Trust's net assets.
Pursuant to the distribution plans (the "Distribution Plans")
adopted by the Trust in accordance with Rule 12b-1 under the
Investment Company Act of 1940, the Trust pays the Distributor
ongoing account maintenance and distribution fees. The fees are
accrued daily and paid monthly at annual rates based upon the
average daily net assets of the shares as follows:
<PAGE>
Account Distribution
Maintenance Fee Fee
Class B 0.25% 0.75%
Class C 0.25% 0.75%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Trust. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
For the year ended July 31, 1997, MLFD earned underwriting discounts
and MLPF&S earned dealer concessions on sales of the Trust's Class A
and Class D Shares as follows:
MLFD MLPF&S
Class A $ 184 $ 2,545
Class D $1,557 $21,923
For the year ended July 31, 1997, MLPF&S received contingent
deferred sales charges of $279,228 and $3,004 relating to
transactions in Class B and C Shares, respectively.
In addition, MLPF&S received $22,790 in commissions on the execution
of portfolio security transactions for the Trust for the year ended
July 31, 1997.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Trust's transfer agent.
Accounting services are provided to the Trust by MLAM at cost.
Certain officers and/or trustees of the Trust are officers and/or
directors of MLAM, PSI, MLFDS, MLFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended July 31, 1997 were $53,308,657 and $114,643,907,
respectively.
Net realized and unrealized gains (losses) as of July 31, 1997 were
as follows:
<PAGE>
Realized Unrealized
Gains (Losses) Gains (Losses)
Long-term investments $21,366,629 $21,327,095
Foreign currency transactions (74,646) (7,515)
----------- -----------
Total $21,291,983 $21,319,580
=========== ===========
As of July 31, 1997, net unrealized appreciation for Federal income
tax purposes aggregated $21,327,095, of which $38,953,626 related to
appreciated securities and $17,626,531 related to depreciated
securities. At July 31, 1997, the aggregate cost of investments for
Federal income tax purposes was $182,312,282.
4. Beneficial Interest Transactions:
Net decrease in net assets derived from beneficial interest
transactions was $54,789,794 and $58,734,873 for the years ended
July 31, 1997 and July 31, 1996, respectively.
Transactions in shares of beneficial interest for each class were as
follows:
Class A Shares for the
Year Ended Dollar
July 31, 1997 Shares Amount
Shares sold 448,154 $ 8,330,555
Shares issued to shareholders
in reinvestment of dividends
and distributions 27,690 494,192
------------ ------------
Total issued 475,844 8,824,747
Shares redeemed (862,003) (15,971,403)
------------ ------------
Net decrease (386,159) $ (7,146,656)
============ ============
Class A Shares for the
Year Ended Dollar
July 31, 1996 Shares Amount
<PAGE>
Shares sold 470,673 $ 8,069,980
Shares issued to shareholders
in reinvestment of dividends 12,995 214,811
------------ ------------
Total issued 483,668 8,284,791
Shares redeemed (888,103) (14,845,546)
------------ ------------
Net decrease (404,435) $ (6,560,755)
============ ============
Class B Shares for the
Year Ended Dollar
July 31, 1997 Shares Amount
Shares sold 950,849 $ 17,425,847
Shares issued to shareholders
in reinvestment of dividends
and distributions 48,665 875,929
------------ ------------
Total issued 999,514 18,301,776
Automatic conversion of
shares (207,430) (3,820,920)
Shares redeemed (2,374,035) (43,883,586)
------------ ------------
Net decrease (1,581,951) $(29,402,730)
============ ============
Class B Shares for the
Year Ended Dollar
July 31, 1996 Shares Amount
Shares sold 1,882,421 $ 32,007,488
Shares issued to shareholders
in reinvestment of dividends 786 13,029
------------ ------------
Total issued 1,883,207 32,020,517
Automatic conversion of
shares (1,079,235) (18,075,199)
Shares redeemed (3,847,236) (64,409,340)
------------ ------------
Net decrease (3,043,264) $(50,464,022)
============ ============
Class C Share for the
Year Ended Dollar
July 31, 1997 Shares Amount
<PAGE>
Shares sold 278,052 $ 5,116,267
Shares issued to shareholders
in reinvestment of dividends
and distributions 2,963 52,754
------------ ------------
Total issued 281,015 5,169,021
Shares redeemed (342,861) (6,275,052)
------------ ------------
Net decrease (61,846) $ (1,106,031)
============ ============
NOTES TO FINANCIAL STATEMENTS (concluded)
Class C Shares for the Year Dollar
Ended July 31, 1996 Shares Amount
Shares sold 395,590 $ 6,702,711
Shares redeemed (366,433) (6,164,383)
------------ ------------
Net increase 29,157 $ 538,328
============ ============
Class D Shares for the Year Dollar
Ended July 31, 1997 Shares Amount
Shares sold 515,787 $ 9,511,946
Automatic conversion
of shares 207,740 3,820,920
Shares issued to shareholders
in reinvestment of dividends
and distributions 95,865 1,709,679
------------ ------------
Total issued 819,392 15,042,545
Shares redeemed (1,731,884) (32,176,922)
------------ ------------
Net decrease (912,492) $(17,134,377)
============ ============
Class D Shares for the Year Dollar
Ended July 31, 1996 Shares Amount
Shares sold 1,953,059 $ 33,593,797
Automatic conversion
of shares 1,078,984 18,075,199
Shares issued to shareholders
in reinvestment of dividends 39,258 648,556
------------ ------------
Total issued 3,071,301 52,317,552
Shares redeemed (3,190,422) (54,565,976)
------------ ------------
Net decrease (119,121) $ (2,248,424)
============ ============
<PAGE>
5. Commitments:
On July 31, 1997, the Trust had entered into foreign exchange
contracts, under which it had agreed to purchase and sell foreign
currency with the approximate value of $618,000 and $2,834,000,
respectively.
6. Loaned Securities:
At July 31, 1997, the Trust held US Treasury Notes having an
aggregate value of approximately $1,557,000 as collateral for
portfolio securities having a market value of approximately
$1,230,000.
7. Subsequent Event:
On September 4, 1997, the Board of Trustees declared dividends per
share payable on September 11, 1997 to shareholders of record
September 3, 1997 as follows:
Ordinary Long-Term
Income Capital Gains
Class A $.096564 $ 1.623299
Class B -- $ 1.623299
Class C -- $ 1.623299
Class D $.044832 $ 1.623299
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders,
Merrill Lynch Global Resources Trust:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of Merrill Lynch
Global Resources Trust as of July 31, 1997, the related statements
of operations for the year then ended and changes in net assets for
each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period
then ended. These financial statements and the financial highlights
are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and the
financial highlights based on our audits.
<PAGE>
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 the 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 at July 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, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
Merrill Lynch Global Resources Trust as of July 31, 1997, the
results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in conformity
with generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
September 5, 1997
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (unaudited)
<TABLE>
The following information summarizes all per share distributions
paid by Merrill Lynch Global Resources Trust during its taxable year
ended July 31, 1997:
<CAPTION>
Record Payable Qualifying Domestic Total Foreign Taxes
Date Date Ordinary Income Ordinary Income Paid or Withheld
<S> <S> <S> <C> <C> <C>
Class A 9/04/96 9/12/96 $.229674 $.229674 $.040262
Class B 9/04/96 9/12/96 $.018215 $.018215 $.040262
Class C 9/04/96 9/12/96 $.086403 $.086403 $.040262
Class D 9/04/96 9/12/96 $.185672 $.185672 $.040262
Additionally, the Trust paid a long-term capital gain distribution
of $.189162 per share to shareholders of record on December 12,
1996. Such distribution is considered domestic source income and
there are no foreign taxes attributable to it.
The qualifying domestic ordinary income qualifies for the dividends
received deduction for corporations.
<PAGE>
The foreign taxes paid or withheld represent taxes incurred by the
Trust on dividends received by the Trust from foreign sources.
Foreign taxes paid or withheld should be included as foreign source
income with an offsetting deduction from gross income or as a credit
for taxes paid to foreign governments. You should consult your tax
adviser regarding the appropriate treatment of foreign taxes paid.
Please retain this information for your records.
PORTFOLIO INFORMATION (unaudited)
For the Quarter Ended July 31, 1997
Percent of
Ten Largest Equity Holdings Net Assets
British Petroleum Co., PLC 2.5%
Newmont Mining Corp. 2.3
Chauvco Resources, Ltd. 2.0
Total, S.A. (Class B) 2.0
Avenor Inc. 1.8
WMC Ltd. 1.8
Placer Dome Inc. 1.8
Ente Nazionale Idrocarburi S.p.A.
(ENI) (ADR) 1.7
M.I.M. Holdings Ltd. 1.7
Weyerhaeuser Co. 1.6
Additions
Champion International Corp.
Normandy Mining Ltd.
North Ltd.
Pechiney (A Shares)
Deletions
IHC Caland N.V.
Kobe Steel Ltd.
Newcrest Mining Ltd.
Occidental Petroleum Corp.
Pacific Forest Products Ltd.
Repsol, S.A.
<PAGE>
OFFICERS AND TRUSTEES
Arthur Zeikel, President and Trustee
Donald Cecil, Trustee
M. Colyer Crum, Trustee
Edward H. Meyer, Trustee
Jack B. Sunderland, Trustee
J. Thomas Touchton, Trustee
Terry K. Glenn, Executive Vice President
Norman R. Harvey, Senior Vice President
Donald C. Burke, Vice President
Edward P. Ix Jr., Vice President
Peter A. Lehman, Vice President and
Portfolio Manager
Gerald M. Richard, Treasurer
Thomas D. Jones III, Secretary
Custodian
The Bank of New York
90 Washington Street, 12th Floor
New York, NY 10286
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
</TABLE>
